When the perfectly competitive firm produces the quantity of output at which marginal revenue equals marginal cost, it naturally a. takes a loss. b. produces the quantity of output at which short-run average total cost equals price, since for the perfectly competitive firm short-run average total cost equals marginal revenue. C. produces the quantity of output at which marginal cost equals price, since for the perfectly competitive firm price equals marginal revenue. d. earns a profit, since equating marginal revenue and marginal cost guarantees profit.

When the perfectly competitive firm produces the quantity of output at which marginal revenue equals marginal cost, it naturally a. takes a loss. b. produces the quantity of output at which short-run average total cost equals price, since for the perfectly competitive firm short-run average total cost equals marginal revenue. C. produces the quantity of output at which marginal cost equals price, since for the perfectly competitive firm price equals marginal revenue. d. earns a profit, since equating marginal revenue and marginal cost guarantees profit.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter13: Firms In Competitive Markets

Section: Chapter Questions

Problem 4CQQ

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