Homework Answers
In short run,both monopolist and competitive firm can earn positive economic profits
In the long run,monopolist but not the competitive firm can earn positive economic profits.
True or False:
The statement is False
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5. Individual Problems 9-5 Describe the difference in economic profit between a competitive firm and a...
In the long run, a firm in a perfectly competitive market earns zero economic profit, so...
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.
8. Refer to the graph above depicting a perfectly competitive firm. When maximizing profit, the total...
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...
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. Draw two graphs. On the first, show the short-run profit maximizing output of an individual...
1. Draw two graphs. On the first, show the short-run profit maximizing output of an individual firm earning an economic profit, including MR, MC, AVC, and ATC. On the second, show the short-run market equilibrium price and quantity. Explain how the industry supply curve and the market equilibrium price and quantity are determined. 2. What is the relationship between the price on the two graphs? Why does this relationship exist? 3. Explain why a firm in a perfectly competitive industry...
15. Which of the following is a true statement about the difference between a price-taker firm and a competitive price-s...
15. Which of the following is a true statement about the difference between a price-taker firm and a competitive price-searcher firm in the long run (more than one answer is correct)? a. Both will sell their products at a price equal to average total cost, but only the price-searcher will produce at minimum average total cost. b. Both will sell their products at a price equal to marginal cost, and only the competitive price searcher will produce at minimum average...
In perfect competition as well as in monopolistic competition, a. profit is positive in a long-run...
In perfect competition as well as in monopolistic competition, a. profit is positive in a long-run equilibrium for each firm. b.entry and exit by firms are restricted. c. there are many firms in a single market. d. marginal revenue is equal to price for each firm. ECTION 22 Monopolistic competition differs from perfect competition because in monopolistically competitive markets a. all firms can eventually earn economic profits. b. each of the sellers offers a somewhat different product. C. strategic interactions...
If perfectly competitive firms are making an economic profit, then A) new firms will enter the...
If perfectly competitive firms are making an economic profit, then A) new firms will enter the market. B) the market cannot be in either a short-run or a long-run equilibrium. C) the market must be in long-run equilibrium but cannot be in a short-run equilibrium. D) the market might be in a long-run equilibrium but not a short-run equilibrium. E) some firms will exit the market.
Generally speaking, a perfectly competitive firm: will always be expected to earn economic profit in the...
Generally speaking, a perfectly competitive firm: will always be expected to earn economic profit in the long run due to entry. may earn an econmic profit or loss in the long run. will always earn a profit in the short run. is expected to earn zero economic profit in the long run due to entry. SUS
The monopolist chooses to produce: O at an inefficient outcome. where marginal cost equals marginal revenue....
The monopolist chooses to produce: O at an inefficient outcome. where marginal cost equals marginal revenue. at a lower quantity than the perfectly competitive firm. O All of these statements are true. In the short run, monopolistically competitive firms: will earn zero economic profits by acting like a monopolist. O can earn positive economic profits by acting like a perfectly competitive firm. will earn zero economic profits by acting like a perfectly competitive firm. can earn positive economic profits by...
5 pts Question 5 In a competitive market the current price is $11, and the typical...
5 pts Question 5 In a competitive market the current price is $11, and the typical firm in the market has ATC $11.50 and AVC $11.15 In the short run firms will shut down, and in the long run firms will leave the market. In the short run firms will continue to operate, but in the long run firms will leave the market. New firms will likely enter this market to capture any remaining economic profits O The firm will...
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.
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...
In perfect competition as well as in monopolistic competition, a. profit is positive in a long-run equilibrium for each firm. b.entry and exit by firms are restricted. c. there are many firms in a single market. d. marginal revenue is equal to price for each firm. ECTION 22 Monopolistic competition differs from perfect competition because in monopolistically competitive markets a. all firms can eventually earn economic profits. b. each of the sellers offers a somewhat different product. C. strategic interactions...
Generally speaking, a perfectly competitive firm: will always be expected to earn economic profit in the long run due to entry. may earn an econmic profit or loss in the long run. will always earn a profit in the short run. is expected to earn zero economic profit in the long run due to entry. SUS
The monopolist chooses to produce: O at an inefficient outcome. where marginal cost equals marginal revenue. at a lower quantity than the perfectly competitive firm. O All of these statements are true. In the short run, monopolistically competitive firms: will earn zero economic profits by acting like a monopolist. O can earn positive economic profits by acting like a perfectly competitive firm. will earn zero economic profits by acting like a perfectly competitive firm. can earn positive economic profits by...
5 pts Question 5 In a competitive market the current price is $11, and the typical firm in the market has ATC $11.50 and AVC $11.15 In the short run firms will shut down, and in the long run firms will leave the market. In the short run firms will continue to operate, but in the long run firms will leave the market. New firms will likely enter this market to capture any remaining economic profits O The firm will...
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