Post Utme Skyline University 2019 Economics Question 21

Practice objective / multiple choice question 21 from the 2019 Post Utme Skyline University Economics examination.

Post Utme Skyline University 2019 Economics Objective / Multiple Choice
Question 21 POST_UTME_SKYLINE_UNIVERSITY • 2019 • ECONOMICS • objective

A firm operating under perfect competition faces a market demand curve that is linear and downward-sloping. If the firm's average total \cost (ATC) curve is U-shaped, what is the likely effect on the firm's profit-maximizing output level if the market price increases?

Answer Options

A. The firm will increase its output level.
Correct Answer B. The firm will decrease its output level.
C. The firm's output level will remain unchanged.
D. The firm will experience a decrease in profit.
Correct Answer
B
Correct Option:
The firm will decrease its output level.

About This Question

This is Post Utme Skyline University 2019 Economics Question 21. It is one of the objective questions from the 2019 Post Utme Skyline University Economics examination.

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