1.the average fixed cost curve increases as output increases over a relevant range of production.
2. average revenue is slightly higher than price.
3. marginal cost curves and average cost curves are both purely upward sloping.
4. a firm that sells at a price below average cost is not making a normal profit.
5. in the short run, it is possible for a perfectly competitive firm to make economic profits or economic losses.
6. if a firm sells its output at a price greater than ac, it will earn economic profit.
7. zero profit in the economic sense means that firms are earning a normal rate of return.
8. in a free market (laissez-faire) system, the price mechanism dictates the production planning (how to produce) decisions.
9. free markets produce relatively high levels of efficiency but low rates of growth.
10. a natural monopoly occurs when a single firm can produce the entire output of the market at a lower average cost than could many firms.