A perfectly competitive firm-
-is expected to earn zero economic profit in the long run due to entry
Generally speaking, a perfectly competitive firm: will always be expected to earn economic profit in the...
A perfectly competitive, profit maximizing firm earns zero economic profit in the long run. The firm’s total cost is: TC = a + bQ2. Use only the cost curve given. Determine mathematically the level of output the firm will produce in the long run. Show mathematically if this amount differs from the amount of output the firm would produce in the short run. Explain why a perfectly competitive firm earns zero economic profit in the long run.
In the long run, a firm in a perfectly competitive market earns zero economic profit, so the opportunity in the short run to enjoy positive economic profits will cause existing firms to increase output and new firms to enter the market.
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...
8. Refer to the graph above depicting a perfectly competitive firm. When maximizing profit, the total profit earned by the firm represented is: A. $220. B. $275. C. $330 D. $605, 26. Refer to the graph above of a monopolistically competitive firm. If the firm maximizes profit, it will earn: A. zero economic profit this year. B. $320,000 economic profit this year. C. 584,000 economic profit this year. D. $56,000 economic profit this year. ATC AVC - 01 02 03...
1)An example of a perfectly competitive firm would be Dannon Yogurt a grain farmer a car manufacturer a drug company 2) In the long run the profit for a Perfectly competitive firm is theoretically ["zero", "small", "large", "negative"] because of ["competition", "lack of competition", "good cost controls", "poor cost controls"] 3)in the short run a P.C. industry will see ["entries and exits", "entry only", "losses", "only exits"] to/from the market based on ["positive profits to firms", "profits and losses to...
Name 1. Describe a perfectly competitive market structure in terms of number of firms, ease of entry a and product differentiation. 2. Draw the short-ran cost and revenue curves for a firm making an economic profit in a perfectly petitive industry. Show the firm's short-run supply curve. 3. Why might a firm continue to produce at a loss in the short na instead of shutting down? a perfectly competitive firm will make an economie profit in the short b. fP-...
3) Suppose a perfectly competitive firm is earning a positive economic profit. Show this situation in a graph. What will happen to economic profits in the long run? Show this situation in a graph. As profits are driven to zero, what happens to consumer surplus? a. b.
Compare and contrast the potential for a perfectly competitive firm and a monopolistically competitive firm to earn positive economic profits in the short run versus the long run. Explain your reasoning
Which of the following is true with respect to a perfectly competitive firm? It will make small economic profits always or go out of business A perfectly competitive firm has a perfectly inelastic demand curve At profit maximization the perfectly competitive firm operates where total revenue is maximized as well The perfectly competitive firms supply curve is its marginal cost curve above AVC All of the above are true with respect to a perfectly competitive firm Question 5 1 pts...
A perfectly competitive firm will earn a profit in the short run when it produces the profit-maximizing quantity of output and the price is: 1) greater than marginal cost. 2) less than marginal cost. 3) less than average variable cost. 4) greater than average total cost.