A profit maximizing firm in a perfectly competitive market supplies 4,000 units at the market price of $6 per unit. The firm is not earning any economic profit. At this level of production the average variable cost (AVC) is $4.5 per unit. Given its cost structure, the lowest AVC the firm can achieve is $4.2. However, the firm is expecting an increase in its power bills from the next month and will also have to pay higher sales commissions. In fact, at the existing production level, both average cost and AVC are expected to increase by $1 from the next month onward. Which of the following is most strongly supported by this information? A. With the increase in cost and no change in price level, the firm will not break even. B. The total variable cost currently incurred to produce 4,000 units is $16,000. C. The firm's average fixed cost is also expected to increase. D. Sales commission will account for a higher proportion of total costs from the next month. E. More firms are likely to enter this market in the short run