Jason cleans swimming pools in a perfectly competitive local market. A profit maximizer, he can charge $$\(\$ 10\)$$ per pool to clean 9 pools per day, incurring total variable costs of $$\(\$ 80\)$$ and total fixed costs of $$\(\$ 20\)$$. Which of the following is true?
A.
Jason should shut down in the short run, with economic losses of \(\$ 20\).
B.
Jason should shut down in the short run, with economic losses of \(\$ 10\).
C.
Jason should clean 9 pools per day, with economic losses of \(\$ 20\).
D.
Jason should clean 9 pools per day, with economic losses of \(\$ 10\).
E.
Jason should clean 9 pools per day, with economic profits of \(\$ 10\).
Exam No： AP Micro Practice Test 4 Year：2024 Question No：30
Answer:
D
Knowledge points:
3.5 Profit Maximization
3.6 Firms’ Short-Run Decisions to Produce and Long-Run Decisions to Enter or Exit a Market
3.7 Perfect Competition
Solution:
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