A firm in a purely competitive industry has a typical cost structure. The normal rate of profit in the economy is 8 percent. This firm is earning $15 on every $150 invested by its founders. Instructions: Enter your answers as a whole number. a. What is its percentage rate of return? percent b. Is the firm earning an economic profit? (Click to select) ♥ If so, how large? percent c. Will this industry see entry or exit? (Click to select) ♥ d. What will be the rate of return earned by firms in this industry once the industry reaches long-run equilibrium? percent

A firm in a purely competitive industry has a typical cost structure. The normal rate of profit in the economy is 8 percent. This firm is earning $15 on every $150 invested by its founders. Instructions: Enter your answers as a whole number. a. What is its percentage rate of return? percent b. Is the firm earning an economic profit? (Click to select) ♥ If so, how large? percent c. Will this industry see entry or exit? (Click to select) ♥ d. What will be the rate of return earned by firms in this industry once the industry reaches long-run equilibrium? percent

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter5: Investment Decisions: Look Ahead And Reason Back

Section: Chapter Questions

Problem 5.6IP

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There are 300 purely competitive farms in the local dairy market. Of the 300 dairy farms, 298 have a cost structure that generates profits of $24 for every $300 invested. Instructions: Enter your answers as a whole number. a. What is the percentage rate of return for these 298 dairies? percent b. The other two dairies have a cost structure that generates profits of $22 for every $200 invested. What is their percentage rate of return? percent
Please help with e and f. Thank you so much!
V2
Does it look like I got the right answers for this question?
Solve D and E only in typed answer
what is her ATC if she prints 10000?
Karen runs a print shop that makes posters for large companies. It is a very competitive business. The market price is currently $1 per poster. She has fixed costs of $100. Her variable costs are $1,000 for the first thousand posters, $800 for the second thousand, and then $750 for each additional thousand posters. Instructions: Enter your answers rounded to two decimal places. a. What is her AFC per poster (not per thousand!) if she prints 1,000 posters? $ What if she prints 2,000 posters? What if she prints 10,000 posters? b. What is her ATC per poster if she prints 1,000? What if she prints 2,000? What if she prints 10,000? 2$ c. If the market price fell to 70 cents per poster, would there be any output level at which Karen would not shut down production immediately? |(Click to select) ♥ %24
Jamal owns and manages a restaurant in Egypt whose annual revenue is $10,000. Annual expenses are as follows: Labor Food and water Electricity Vehicle lease Rent Interest on loan for equipment Jamal could earn $2,000 per year as a farmer. However, he prefers to run the restaurant. In fact, he would be willing to pay up to $550 per year to run the restaurant rather than to farming. Is the restaurant making an economic profit? Calculate the economic profits? 2. Should Jamal stay in the restaurant business? Explain your answer. $4,000 1000 200 300 1000 2,000
Problem 10-07 (algo) There are 300 purely competitive farms in the local dairy market. Of the 300 dairy farms, 298 have a cost structure that generates profits of $21 for every $300 invested. Instructions: Enter your answers as a whole number. a. What is the percentage rate of return for these 298 dairies? 7 percent b. The other two dairies have a cost structure that generates profits of $24 for every $200 invested. What is their percentage rate of return? 12 percent c. Assuming that the normal rate of profit in the economy is 9 percent, and that firms cannot copy each other's technology, will there be entry or exit? Exit d. Will the change in the number of firms affect the two that earn $24 for every $200 invested? Yes, because those exiting firms will spread their technology. No, because those two firms are too small. No, because the exiting firms didn't belong in the industry. Yes, because those two firms can claim a larger market share. e. What will be the rate of return earned by…
Please answer all of part C And confirm over part A and B
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