Author Question: For a perfectly competitive firm operating at the profit-maximizing output level in the short run, ... (Read 111 times)

cherise1989 · **on:** Jun 30, 2018

For a perfectly competitive firm operating at the profit-maximizing output level in the short run,
a. MR = TR
b. MC = price
c. MC = ATC
d. MC = AVC
e. AFC = price

Question 2

In the short run, how will a profit-maximizing monopolist react if its marginal cost suddenly increases? It will
a. lower price to expand revenue possibilities
b. restrict output to extract a higher price from customers
c. maintain the current price if profit is still positive
d. increase plant size to lower marginal cost
e. decrease plant size to lower marginal cost