Which statement is TRUE?

A) If the price falls below the average total cost,the firm will earn economic profits.
B) Price and marginal revenue are the same in perfect competition.
C) Economic profit per unit is found by subtracting AVC from the price.
D) Economic profit is always positive in the short run.

Marginal Revenue

The additional income from selling one more unit of a good; essentially the change in total revenue from an additional unit sold.

Perfect Competition

An idealized market structure in which there are many buyers and sellers, no barriers to entering or exiting the market, and products are identical.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, measuring the true profitability of a firm.