Your firm operates in a perfectly competitive market. The market price is above both your firm’s average total cost and your firm’s marginal cost at the quantity that your firm is currently producing. Which of the following is true? A. Your firm runs a loss and could reduce this loss by producing a larger quantity. B. Your firm runs a loss and could reduce this loss by producing a smaller quantity. C. Your firm makes a positive economic profit but could make more profit by producing a larger quantity. D. Your firm makes a positive economic profit but could make more profit by producing a smaller quantity
4. Your firm operates in a
your firm’s
firm is currently producing. Which of the following is true?
A. Your firm runs a loss and could reduce this loss by producing a larger quantity.
B. Your firm runs a loss and could reduce this loss by producing a smaller quantity.
C. Your firm makes a positive economic profit but could make more profit by
producing a larger quantity.
D. Your firm makes a positive economic profit but could make more profit by
producing a smaller quantity
PROVIDE A BRIEF WRITTEN EXPLANATION
JUSTIFYING YOUR CHOICE.
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