Question

12. In the long run: A. there will be no entry or exit of firms in this industry B. new firms enter the industry and curve A shifts to the right. C. firms exit this industry and curve A shifts to the left D. new firms enter this industry and curve F shifts to the right Questions 1- 14 refer to Figure 1 I. The industry's short-run supply curve is curve A. A H B. С.Е. D. F 2. The industry's demand curve is curve 13. The long-run equilibrium price in this industry will be A. B. B D. F A. P 3. Curve K in the diagram is the: A. industry's sapply curve. B. firm's demand curve. C. firm's average variable cost curve D. firm's supply curve 14. The industry's long-run supply curve is curve A. C and the industry is an increasing-cost industry B. C and the industry is a decressing-cost industry C. C and the industry is a constant-cost industry D. A and the industry is an increasing-cost industry E. F and the industry is a decreasing-cost industry 4. Curve J in the diagram is the A. industry's long-run supply curve. B. firm's demand curve C. firm's marginal revenue curve. D. Both B and C. 15. In the short run, a typical firm in a perfectly competitive industry: A. must cam only an economic proft B. must earn only a normal profit C. must earn only a negative economic profit D. may carn positive, negative or zero economic profits 5. Curve H in the diagram is the: A. firm's MC curve D. firm's AVC curve B. firm's ATC curve. . firm's demand curve. C. firm's AFC curve 16. In the long run, a typical firm in a perfectly competitive industry: A. must earn only an economic proft B. must earn only a normal profit C. must earn only a negative economic profit D. may earn positive, negative or zero economic profits 6. Curve G in the diagram is the: A. firm's MC curve D. firm's AVC curve. B. firm's ATC curveE firm's demand curve. C. firm's AFC curve Figure 1 7. The firm's short-run supply curve is: A. curve A. B. the upward-sloping portion of curve H. C. the upward-sloping section of curve G. D. the portion of curve G that lies above curve H E. the portion of curve G that lies above curve K 8. The firm's short-run shut-down point is at a price of: 9. The current equilibrium price in the diagram is: According to the information in the diagram, in the short run the profit-maximizing (or loss-minimizing firm) will: shut down and incur a loss equal to fixed cost in absolute value produce where P-MC and incur a loss that is less than fixed cost in absolute value _ 10. A. B. C. produce where P- MC and earn only normal profits D. produce where P MC and carn economic profits E. produce where P- ATC and ean only normal profits At the equilibrium price you found in the previous question, the industry is in long-hun equilibrium short-run equilibrium. Both A and B 11. A. B. C. Not enough information has been given to answer this question. uestos 17-24 are on the oter side D.

Answer 1

Answer:

1- The industry’s short-run supply curve is curve : A. A

the upward sloping curve in the industry figure 1

2- the industry’s demand curve is curve: D. F

The downward sloping curve in the industry figure

3- curve K in the diagram is the:

c. firm’s average variable cost curve

4. curve J in the diagram in the:

D. both B and C

It is the perfect competition market where the demand curve, marginal revenue curve are same and horizontal straight line

5. curve H in the diagram is the:

B. firm’s ATC curve (average cost curve)

6. curve G in the diagram is the:

A. firm’s MC curve (marginal cost curve)

7. the firm’s short –run supply curve is:

E. the portion of curve G that lies above curve K

Supply curve of the firm is MC curve above the AVC curve

8. the firm’s short –run shut down point is at a price of :

B. P2

At the price where MC = AVC

9. the current equilibrium price in the diagram is :

D. P4

Where MC=MR

10. in the short run the profit maximizing will:

D. produce where p= MC and earn economic profit