14 The competitive firm's supply curve is equal toits marginal cost curve.the portion of its marginal cost curve that lies above AC.the portion of its marginal cost curve that lies above AVC.the portion of its marginal cost curve that lies above AFC.A15 Which is an important aspect of the perfectly competitive market thatleads to long run equilibrium?perfect informationfreedom of entry and exitAВprice taking behaviorhomogeneous products16 Long-run market supply curves are downward sloping ifAfirms are identical.Вthe number of firms is restricted in the long run.Cinput prices fall as the industry expands.All of the above.17 A profit maximizing monopolistis guaranteed to lose money because of a lack of competition.is not guaranteed to make a positive profit.is guaranteed to make a positive profit, hence the desire to be amonopolist.is guaranteed to make a non-negative profit, otherwise government wouldstep in to assist.AВCD18 The monopolist's marginal revenue curveAdoesn't exist.Вlies below the demand curve.is identical to the demand curve.Dlies above the demand curve.19 If the inverse demand function for a monopoly's product is p =100 - 2Q,then the firm's marginal revenue function isA-2100 - 4Q.200 - 4Q.200 - 2Q.ВC20 Which of the following could create a cost advantage for a monopoly?better technologylower friction due to better organizationAstandardizationAll of the above. 7 Ais a governance structure where owners are not personallyliable.sole proprietorshippartnershipmixed enterpriseAcorporation8 The figure to the right shows the cost curves for a competitive firm. If thefirm is to earn economic profit, price must exceed$1q|$0MCAВ$515C$10$11AC9 If a profit-maximizing firm finds that, at its current level of production,MR > MC, it willearn greater profits than if MR = MC.increase output.decrease output.A1110AVCshut down.10 Market structure depends uponthe ease of entry and exit.the ability of firms to differentiate their goods and services.Athe number of firms in the market.All of the above.11 A horizontal demand curve for a firm implies thatthe firm is a monopoly.the market the firm is operating in is not competitive.the firm is selling in a competitive market.the products of that firm are very different from other firms' products.A4012 The short run isa period of time in which at least one input cannot be varied.when firms are stuck with sunk costs, unlike the long run.AВCtreated the same way as the long run.a period of time when no inputs can be varied.13 If a competitive firm finds that it maximizes short-run profits by shuttingdown, which of the following must be TRUE?p< AVC for all levels of output.p< AVC only for the level of output at which p= MC.p< AVC only if the firm has no fixed costs.The firm will earn zero profit.AВCD

Supply curve: It represents the relationship between price and the quantity of the product that a…

14 The competitive firm's supply curve is equal to its marginal cost curve. the portion of its marginal cost curve that lies above AC. the portion of its marginal cost curve that lies above AVC. the portion of its marginal cost curve that lies above AFC.

14 The competitive firm's supply curve is equal to its marginal cost curve. the portion of its marginal cost curve that lies above AC. the portion of its marginal cost curve that lies above AVC. the portion of its marginal cost curve that lies above AFC.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

t of 35 45 40 30 25 255 15 20 10 5 MC, AC MC AC 9 0 100 200 300 400 500 The graph shows average and marginal cost curves for a typical firm in a perfectly competitive industry in LONG-RUN equilibrium. The long-run equilibrium price of the product is $ In long-run equilibrium the firm will produce units. In long-run equilibrium the firm will earn $ economic profit.
PRICE (Cents per bushel) COST (Cents per bushel) 100 90 80 70 60 50 ATC 40 30 20 10 AVC MC 0 5 10 15 20 25 30 35 40 45 50 OUTPUT (Thousands of bushels) The following graph shows the market demand for wheat. 1. Use the orange points (square symbol) to plot the short-run industry supply curve for the wheat industry. Specifically, place an orange point at the lowest point of the supply curve and another orange point at the highest point of the supply curve. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output, since this is the industry supply curve. Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.) 2. Place the black point (plus symbol) on the graph to indicate the short-run equilibrium price and quantity in this market. (Note: Dashed drop lines will automatically extend to both axes.) 100 90 80 60 30 20 2 2 2 2 8 8 2 2 2 2 ° 0 Demand 350 700 1050 1400 1750…
ume the pizza market is a perfectly competitive constant cost industry, and all firms have identical homogenous firms). The market demand and market supply functions for this perfectly competit stry are given below. L 0 1 2 3 4 5 6 7 8 9 q=TP 0 10 20 30 40 50 60 70 80 90 TC 100 205 2.45 280 340 430 545 720 930 1190 P = 30.5-.005Q P = 1.7+.003Q TFC TVC 100 0 100 105 20.50 10.50 100 145 12.25 7.25 100 180 9.33 6.00 100 240 8.50 6.00 100 330 8.60 6.60 100 445 9.08 7.42 100 620 10.29 8.86 100 830 11.63 10.38 100 1090 13.22 12.11 ATC AVC MC 10.50 4.60 3.50 6.00 9.00 11.5 17.50 21.00 26.00
The table below shows the total costs faced by Gregory's Jewelry firm for different quantities of necklaces sold. Quantity 0 1 2 3 4 5 6 7 8 9 10 Total Cost $64 $79 $98 $120 $145 $171 $198 $228 $262 $305 $353 Gregory's Jewelry firm sells necklaces in a perfectly competitive market with a downward sloping demand curve and an upward sloping supply curve. The market price is $32/unit. A. Calculate the average fixed cost of producing 8 units. Show your work. B. Identify the profit maximizing quantity. Explain using marginal analysis. C. Calculate the economic profit at the profit maximizing quantity you identified in Part B. Show your work. D. Based on your answer to Part C, will the number of firms in the industry increase, decrease, or stay the same in the long run? Explain. E. Based on your answer to Part C, will the market price increase, decrease, or stay the same in the long run? Explain. F. The income elasticity of demand for necklaces is -3 and the cross price elasticity of demand…
Table Cost.EX2.2: Data for a Competitive Firm Marginal Marginal Output Cost Revenue (Q) (MC) (MR) 10 $3.00 $4.00 11 $3.50 $4.00 12 $4.00 $4.00 13 $4.50 $4.00 14 $5.00 $4.00 15 $5.50 $4.00 16 $6.00 $4.00 Refer to Table Cost.EX2.2. If the firm wishes to maximize profit, it should produce units. O 10 O 12 O 11 6.
1. Draw the cost curves for a typical firm. Explain how a competitive firm chooses the level of output that maximizes profit. At that level of output, show on your graph the firm’s total revenue and total cost.
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.