Author Question: The table above shows output and costs of Evan's Subs, a typical perfectly competitive firm in a ... (Read 105 times)

oliviahorn72 · **on:** Jun 29, 2018

The table above shows output and costs of Evan's Subs, a typical perfectly competitive firm in a local market for sandwiches. Evan's fixed cost is 9 per hour. The current market price of a sandwich is 6.

If the market price does not change, Evan's will A) continue to operate in the short run, but will exit the industry in the long run.
B) continue to operate in the short run and in the long run.
C) shut down.
D) increase its production in the long run.

Question 2

The difference between the marginal social cost and the marginal private cost equals the

A) cost of producing an additional unit of a good.
B) marginal external benefit.
C) marginal external cost.
D) marginal private benefit.