Homework Answers
Answer: produce at an output level where average total cost equals marginal costs
Perfect competition is effecient because firms produce at minimum average total cost so that firms earn zero economic profit in long run
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Answer: monopoly profits can continue in long run beacuse monopoly produces more and charges a higher price than perfectly competitive industry.
A monopoly charges a higher price and produces a lower quantity than perfect competition
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Answer : if demand is downward sloping then P> MR
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In the long run, all of the firms in a perfectly competitive industry will: exit the...
In the long run, all of the firms in a perfectly competitive industry will: produce an...
In the long run, all of the firms in a perfectly competitive industry will: produce an output level at which price is greater than average total cost. earn an economic profit greater than zero. produce at an output level at which average total cost equals marginal cost. exit the industry if price is greater than average total cost.
The demand curve for a perfectly competitive firm options: is upward sloping. is perfectly horizontal. is...
The demand curve for a perfectly competitive firm options: is upward sloping. is perfectly horizontal. is perfectly vertical. maybe downward or upward sloping, depending upon the type of product offered for sale. In the short run, the best policy for a perfectly competitive firm is to Question 17 options: shut down its operation if the price ever falls below average total cost. produce and sell its product as long as price is greater than average variable cost. shut down its...
If the donut industry is perfectly competitive and is in long-run equilibrium, then the price of...
If the donut industry is perfectly competitive and is in long-run equilibrium, then the price of a donut Question 20 options: A) equals long-run average cost. B) is greater than marginal cost. C) is greater than long-run average cost. D) is greater than short-run average cost. The industry that produces zangs is in long-run equilibrium. Then the demand for zangs increases permanently. As a result, firms in the industry will ________. Some firms will ________ the industry, and the industry...
a declines continually as output increases. Question 8 In perfectly competitive long-run equilibrium: all firms make...
a declines continually as output increases. Question 8 In perfectly competitive long-run equilibrium: all firms make positive economic profits. all firms produce at the minimum point of their average total cost curves. the industry supply curve must be upward sloping. all firms face the same price, but the value of marginal cost will vary directly with firm size. Question 9
The long-run supply curve for a perfectly competitive, constant-cost industry O is horizontal at minimum ATC....
The long-run supply curve for a perfectly competitive, constant-cost industry O is horizontal at minimum ATC. O is upward-sloping. O is horizontal at minimum AVC. O is found by adding up the marginal cost curves for all firms in the industry. As more firms enter the market: O the short-run market demand curve shifts to the left. O the short-run market supply curve shifts to the right. O the short-run market supply curve shifts to the left. O the short-run...
1. (5 points) Assume that a perfectly competitive industry is in long run equilibrium. Then an...
1. (5 points) Assume that a perfectly competitive industry is in long run equilibrium. Then an improvement in technology reduces the average total cost and marginal cost of all firnis. In the long run what happens to price, economic profits, and number of firms in the industry? Please give an explanation.
The perfectly competitive firm's demand curve is: Perfectly elastic. Relatively elastic Perfectly inelastic. Relatively inelastic Statement...
The perfectly competitive firm's demand curve is: Perfectly elastic. Relatively elastic Perfectly inelastic. Relatively inelastic Statement 1: In the long run, firms in a monopolistically competitive industry will be producing that quantity that maximize social surplus. Statement 2: In the long run, firms in a monopolistically competitive industry will be producing at the minimum of its ATC curve. Statement (1) is true; statement (2) is false. Statements (1) and (2) are both true. Statement (1) is false; statement (2) is...
QUESTION 7 Monopolistic competitive firms in the long run earn: positive economic profits. zero pure economic...
QUESTION 7 Monopolistic competitive firms in the long run earn: positive economic profits. zero pure economic profits. negative economic profits. Positive, zero, or negative economic profits. QUESTION 8 Which of the following statements best describes firms under monopolistic competition? Profits will be positive in the long run. Price always equals average variable cost. In the long run, positive economic profit will be eliminated. Marginal revenue equals minimum average total cost in the short run. QUESTION 9 Which of the following...
1. A cartel is a group of firms that attempts to a. maximize joint revenue. b....
1. A cartel is a group of firms that attempts to a. maximize joint revenue. b. increase competition. c. behave independently. d. maximize joint profit. 2. If a firm's product loses brand loyalty, then the demand curve will: a. Become less price elastic. b. Shift to the right. c. Become more price elastic. d. Shift to the left. 3. Assume a monopoly confronts the same costs and demand as a competitive industry. In this case, the monopolist produces: a. Less...
12. In the long run: A. there will be no entry or exit of firms in...
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...
In the long run, all of the firms in a perfectly competitive industry will: produce an output level at which price is greater than average total cost. earn an economic profit greater than zero. produce at an output level at which average total cost equals marginal cost. exit the industry if price is greater than average total cost.
a declines continually as output increases. Question 8 In perfectly competitive long-run equilibrium: all firms make positive economic profits. all firms produce at the minimum point of their average total cost curves. the industry supply curve must be upward sloping. all firms face the same price, but the value of marginal cost will vary directly with firm size. Question 9
The long-run supply curve for a perfectly competitive, constant-cost industry O is horizontal at minimum ATC. O is upward-sloping. O is horizontal at minimum AVC. O is found by adding up the marginal cost curves for all firms in the industry. As more firms enter the market: O the short-run market demand curve shifts to the left. O the short-run market supply curve shifts to the right. O the short-run market supply curve shifts to the left. O the short-run...
1. (5 points) Assume that a perfectly competitive industry is in long run equilibrium. Then an improvement in technology reduces the average total cost and marginal cost of all firnis. In the long run what happens to price, economic profits, and number of firms in the industry? Please give an explanation.
The perfectly competitive firm's demand curve is: Perfectly elastic. Relatively elastic Perfectly inelastic. Relatively inelastic Statement 1: In the long run, firms in a monopolistically competitive industry will be producing that quantity that maximize social surplus. Statement 2: In the long run, firms in a monopolistically competitive industry will be producing at the minimum of its ATC curve. Statement (1) is true; statement (2) is false. Statements (1) and (2) are both true. Statement (1) is false; statement (2) is...
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...
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