A perfectly competitive firm will shut down immediately when the market price falls below: a)...
Question:
A perfectly competitive firm will shut down immediately when the market price falls below:
a) average variable cost.
b) average total cost.
c) average fixed cost.
d) marginal cost.
e) None of the above.
Perfectly competitive firms
Perfectly competitive firms deal in identical products as the products of firms are the same all colors, textures, and so on. The perfectly competitive firms can either enter or make an exit from the market whenever the firms desire.
Answer and Explanation: 1
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View this answera) average variable cost
The average variable costs are the renowned indicator of determining the output level that should be produced by an...
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Perfectly Competitive Market: Definition, Characteristics & Examples
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Chapter 3 / Lesson 63
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Learn the definition of perfect competition and understand how a perfectly competitive market works. Study the characteristics of a perfectly competitive market with examples.
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