Consider a competitive firm operating in the short run. The firm takes the market price as given and then decides how much output to produce at that given price. When the market price is £60 the firm produces nothing, but when the market price is £100 the firm produces 40 units of output. From this information we can infer that: A the average total cost of production must be less than £60 B I do not want to answer this question. C the marginal cost of production can never be less than £60 D the firm operates under conditions of constant marginal cost E the average total cost of producing 40 units of output is less than £60 F the minimum of average variable cost is somewhere between £60 and £100

Consider a competitive firm operating in the short run. The firm takes the market price as given and then decides how much output to produce at that given price. When the market price is £60 the firm produces nothing, but when the market price is £100 the firm produces 40 units of output. From this information we can infer that: A the average total cost of production must be less than £60 B I do not want to answer this question. C the marginal cost of production can never be less than £60 D the firm operates under conditions of constant marginal cost E the average total cost of producing 40 units of output is less than £60 F the minimum of average variable cost is somewhere between £60 and £100

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter8: Cost Analysis

Section: Chapter Questions

Problem 9E

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