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The Diagram Below Shows the Market Demand Curve and the Cost

Question 14

Multiple Choice

The diagram below shows the market demand curve and the cost curves for a single firm. The diagram below shows the market demand curve and the cost curves for a single firm. FIGURE 12-6 -Refer to Figure 12-6.Suppose this firm is being regulated using a policy of average-cost pricing.In this case,economic profits to the firm are represented by the area A) P<sub>2</sub>P<sub>3</sub>ad. B) P<sub>2</sub>P<sub>3</sub>ab. C) 0P<sub>3</sub>aQ<sub>1.</sub> D) P<sub>1</sub>P<sub>2</sub>bc. E) There are no economic profits. FIGURE 12-6
-Refer to Figure 12-6.Suppose this firm is being regulated using a policy of average-cost pricing.In this case,economic profits to the firm are represented by the area


A) P2P3ad.
B) P2P3ab.
C) 0P3aQ1.
D) P1P2bc.
E) There are no economic profits.

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