Multiple Choice
A firm sells a product in a purely competitive market. The marginal cost of the product at the current output of 3,200 units is $7.40. The minimum possible average variable cost is $4.90. The market price of the product is $8.20. To maximize profits or minimize losses, the firm should
A) continue producing 3,200 units..
B) continue production, but reduce output..
C) increase production..
D) shut down..
Correct Answer:
Verified
Correct Answer:
Verified
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