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Suppose a Profit-Maximizing Firm in a Perfectly Competitive Market Is

Question 77

Multiple Choice

Suppose a profit-maximizing firm in a perfectly competitive market is earning an economic profit of $1,345. If the firm's fixed cost increases from $200 to $300, the firm will:


A) reduce its output.
B) raise its price.
C) earn a greater profit.
D) earn a smaller profit.

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