QUESTION 4 Which of the following is the profit maximizing rule for a perfectly
ID: 1192381 • Letter: Q
Question
QUESTION 4
Which of the following is the profit maximizing rule for a perfectly competitive firm?
A.
Operate where marginal revenue is equal to marginal cost.
B.
Operate where total revenue is maximized.
C.
Shutdown in the short run as soon as price rises above average variable cost.
D.
Only operate if you can make economic profits in the long run.
E.
Operate where marginal product of workers is maximized.
A.
Operate where marginal revenue is equal to marginal cost.
B.
Operate where total revenue is maximized.
C.
Shutdown in the short run as soon as price rises above average variable cost.
D.
Only operate if you can make economic profits in the long run.
E.
Operate where marginal product of workers is maximized.
Explanation / Answer
A.
Operate where marginal revenue is equal to marginal cost.
A.
Operate where marginal revenue is equal to marginal cost.
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