Answer to Question #181962 in Macroeconomics for james

Question

QUESTION 11

The profit-maximizing choice for a perfectly competitive firm:

1. Is where the total cost is greater than the total revenue.
2. Is where the total cost is less than the marginal revenue.
3. Will occur at the level of output where marginal revenue is greater than total cost.
4. Will occur at the level of output where marginal revenue is equal to total cost.
5. Will occur at the level of output where marginal revenue is equal to marginal cost.

QUESTION 12

When a firm is experiencing losses, it must face a question:

1. Should it continue producing or should it shut down?
2. How much pie does somebody really need?
3. How much weight does one have to lose before it is enough?
4. Who cares about weight loss anyway?
5. All of the above.

Answer 1

QUESTION 11

The profit-maximizing choice for a perfectly competitive firm:

Will occur at the level of output where marginal revenue is equal to marginal cost.

QUESTION 12

When a firm is experiencing losses, it must face a question:

Should it continue producing or should it shut down?