Asked by Mallika Khullar on May 04, 2024
Verified
That Table 8.1 shows a short-run situation is evident from:
A) the linear marginal revenue function.
B) the constant price.
C) the increasing marginal cost.
D) the presence of positive costs at Q = 0.
E) the absence of marginal values at Q = 0.
Short-Run Situation
A period in which at least one of a firm's inputs is fixed, limiting its capacity to adjust output levels quickly.
Marginal Revenue
The increase in revenue a business gets from the sale of an extra unit of a product or service.
Marginal Cost
The incremental cost of producing an additional unit of a product or service.
- Identify the optimal output level for maximizing earnings for enterprises in varied market competition conditions and evaluate the existence of economic gains or deficits.
Verified Answer
AT
Areej TariqMay 11, 2024
Final Answer :
D
Explanation :
The presence of positive costs at Q = 0 indicates that the firm has fixed costs and is operating in the short run. In the long run, all costs are variable and can be adjusted to zero if the firm chooses to exit the market. The other options do not necessarily indicate a short-run situation.
Learning Objectives
- Identify the optimal output level for maximizing earnings for enterprises in varied market competition conditions and evaluate the existence of economic gains or deficits.
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