1- If a firm is a price-taker, then

Select one:

a.marginal revenue is equal to price

b.the firm can sell as much output as it likes at themarket-determined price

c.marginal revenue is equal to total revenue

d.both a and b

2- Suppose a firm is producing an output level for which priceexceeds average total cost.

From this information, which of the following can bededuced?

I. the firm is maximizing profits

II.the firm is earning positive profits

III. the firm is a price taker

IV. the firm faces a downwardsloping demand curve

Select one:

a.II only

b.II and IV only

c.I and III only

d.I and II only

e.II and III only.