Asked by
paula culma
on Nov 04, 2024
Verified
If P = MC and MC <ATC, then a perfectly competitive firm will earn ________ profits.
A) positive
B) zero
C) negative
D) break-even
MC < ATC
A condition where the marginal cost of producing an additional unit is less than the average total cost, implying the company can lower its average total cost by increasing production.
Perfectly Competitive
A perfectly competitive market is characterized by many buyers and sellers, homogenous products, and free entry and exit, leading to price determination by market forces.
- Comprehend the distinction between economic gains and the threshold of breaking even amidst conditions of perfect competition.
Verified Answer
JB
Learning Objectives
- Comprehend the distinction between economic gains and the threshold of breaking even amidst conditions of perfect competition.