Which of the following statements is not correct for perfectly competitive firms? The firm’s decision in the short-run to shut down is when price is lower than average variable cost. The firm maximizes profit by producing the quantity at which marginal cost equals marginal revenue. The firm’s decision in the long-run to exit is when price is higher than average total cost. Price is equal to marginal revenue and average revenue.

Which of the following statements is not correct for perfectly competitive firms? The firm’s decision in the short-run to shut down is when price is lower than average variable cost. The firm maximizes profit by producing the quantity at which marginal cost equals marginal revenue. The firm’s decision in the long-run to exit is when price is higher than average total cost. Price is equal to marginal revenue and average revenue.

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter9: Perfect Competition

Section: Chapter Questions

Problem 12QP

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Question 18

Which of the following statements is not correct for perfectly competitive firms?

		The firm’s decision in the short-run to shut down is when price is lower than average variable cost.
		The firm maximizes profit by producing the quantity at which marginal cost equals marginal revenue.
		The firm’s decision in the long-run to exit is when price is higher than average total cost.
		Price is equal to marginal revenue and average revenue.

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