If the price is greater than average total cost at the profit-maximizing quantity of output in the short run,a perfectly competitive firm will:

A) produce at a loss.
B) produce at a profit.
C) shut down production.
D) produce more than the profit-maximizing quantity.

Average Total Cost

Average Total Cost is the total cost of production divided by the quantity produced, encompassing both fixed and variable costs.

Profit-maximizing

A process or strategy that firms employ to determine the price and output level that leads to the highest profit.

Short Run

A period during which at least one factor of production is fixed and cannot be changed, influencing a firm's capacity to alter production levels.