A long-run equilibrium for a perfectly competitive industry is characterized by which of the following conditions: O existing firms want to exit O new firms want to enter O price is at minimum average total cost (ATC) O price is at minimum average variable cost (AVC)

A long-run equilibrium for a perfectly competitive industry is characterized by which of the following conditions: O existing firms want to exit O new firms want to enter O price is at minimum average total cost (ATC) O price is at minimum average variable cost (AVC)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: In the long-run, any perfectly competitive firm that produces will choose a quantity such that

A: The market is a location where the transaction of services and commodities takes place. It is…

Q: Perez Lumber Company sells surfboards in a perfectly competitive market. The marginal cost of…

A: A perfectly competitive firm:In a perfect competition, there are many sellers and buyers, thus the…

Q: A competitive firm has a total cost is given by: TC = 0.2q² + 12q + 200. If the market price is $60.…

Q: Which of the following is true about firms exiting a perfectly competitive market? Select the…

A: In the perfectly competitive market there are huge number of sellers and buyers selling homogenous…

Q: Which of the following is ot a characteristic of a perfectly competitive market? no barriers to…

A: When talking about perfectly competitive market, it is the place with highest degree of competition…

Q: The supply curve for a perfectly competitive firm is its marginal cost curve as the firm should…

A: Introduction All firms would offer similar goods in a market with perfect competition, there would…

Q: Which of the following is not a characteristic of a perfectly competitive market? O zero economic…

A: Perfect competition is a market structure where there are large no of buyers and sellers selling…

Q: Marianne owns a dairy farm near Fresno, CA. She is currently producing cheese at an output level…

A: Since you have posted multiple questions, we will provide the solution only to the first question as…

Q: Which statements is TRUE for a perfectly competitive firm that is in long-run equilibrium? O It is…

A: A homogeneous product that has a large number of sellers and buyers is known as the perfect…

Q: Balin's Burger Barn operates in a perfectly competitive market. Balin's is currently earning…

A: In perfect competition, Price is always equal to marginal cost. And there is always zero profit.…

Q: The business shown in the graph below operates in a perfectly competitive market. An example of a…

A: A perfectly competitive market is market structure in which a large number of firms produce…

Q: The price charged by a firm in a perfectly competitive market always equals its:O total revenue.O…

A: In a perfectly competitive market, there are many buyers and sellers, and each firm sells an…

Q: Perfectly competitive firms earn zero economic profit in the long run. True False

A: In perfectly competitive market, price is constant so it is equal to marginal revenue. Profit is…

Q: Suppose that the equilibrium price is $10.19 (black line). This firm is earning OProfits O Losses O…

A: A perfectly competitive firm is a price taker and can sell any quantity of the commodity at the…

Q: 0 E Multiple Choice O O О н G Which point is not on the perfectly competitive firm's short-run…

A: The portion of the marginal cost curve that lies above the average variable cost curve is defined as…

Q: Suppose a perfectly competitive market is in equilibrium and demand for the product decreases O in…

A: In perfectly competitive market, there are large number of firms selling identical goods

Q: The figure shows the short run conditions of a firm in a perfectly competitive market. In the long…

A: In a perfectly competitive market, firms are price takers and have no control over the market price.…

Q: Use the table to answer the question below for firm operating in a Perfectly Competitive market.…

A: A perfect competitive market is a market that has a large number of buyers and sellers, selling…

Q: Which of the following is not a characteristic of a perfectly competitive market? Goods offered for…

A: A perfectly competitive market is characterized by the presence of a large number of buyers and…

Q: perfectly elastic

A: Explanation: Perfect competition could be a market-style wherever there's a large range of patrons…

Q: conomic profit in the long run. al cost pricing

A: Answer provided below,

Q: The accompanying graphs represent the market for soybeans, a perfectly (purely) competitive market,…

A: Market equilibrium under perfect competition is the point where market demand is equal to the market…

Q: Which of the following is true for a perfectly competitive industry?

A: option 3 is rhe correct answer The firm in industry produce standardized products It's dentical…

Q: In the short run in perfect competition if P>ATC which of the following will occur? firms will enter…

A: A firm in a perfectly competitive market wants to maximize profits just like any other firm. The…

Q: MC Price AC £/unit AVC D2 D3 D1 D4 Quantity/ week Figure 10 Cost curves for a firm Figure 10 shows…

A: Demand Curve: - demand curve is the graphical way of showing the relationship between the quantity…

Q: For prices above a perfectly competitive firm will supply the level of output for which P = MC on…

A: In a perfectly competitive market, a firm offers a level of output where P (price) equals MC…

Q: What is the total fixed cost of Firm A, a perfectly competitive firm facing the demand d, at the…

A: In perfectly competitive market, there are large number of firms selling identical goods.

Q: A firm in a perfectly competitive market produces 700 units. The average cost of producing each unit…

A: Firm operates in perfectly competitive market.The firm is producing 700 units. The average cost of…

Q: Which describes the firms supply curve for the short run with perfect competition? O The section of…

A: "Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: The market demand curve for a product produced in a perfectly competitive industry is normally O a…

Q: If new firms enter a perfectly competitive industry, the market supply A) does not change. B)…

A: A perfectly competitive market is one where there are several sellers and buyers dealing in an…

Q: A mattress company operates in a perfectly-competitive environment. If the firm can increase its…

A: In perfect competition, There exists a large number of buyers and sellers. The firm will produce…

Q: (1) For the demand curve facing a perfectly competitive firm is P= MR = AR MR MR Q > 0 (2) When MR…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: MC АТС $25.00 AVC $19.50 $15.00 $12.50- 30 40 50 60 Output (Q) For the firm shown in the diagram…

A: For a competitive firm its produce output where P=MC. So as price change firm decides how much to…

Q: Refer to the figure above, which indicate a perfectly competitive industry. If the p equal to $60,…

A: The perfect competition refers to a market where a large number of buyers and sellers exist. Demand…

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Question 18 Suppose a perfectly competitive firm faces the following situation: P = $10, output= 3,000, ATC= $8.50, MC $11, and AVC=$7.50. Which statement accurately describes the firm's situation? = O The firm incurs a loss and is minimizing its losses. O The firm carns a profit but should increase output to maximize its profits. O The firm is maximizing its profits. The firm earns a profit but should decrease output to maximize its profits.
Price (dollars) 8 7 6 5 4 3 2 1 0 80 O increase; increase; increase O remain same; remain same; decrease O decrease; remain same; decrease O decrease; decrease; decrease Short-run Short-run MC AC 100 110 The graph above shows the cost curves for a firm selling in a perfectly competitive market. If the market demand falls due to a recession, the long run equilibrium price will output will ., the firm's and industry output will Output (per day) Long-run AC
Looking to see how to resolve
Suppose we have a firm in a perfectly competitive market. Assume that we have the usual shaped cost curves. At a market price of $15 the profit maximizing firm produces 53 units. Something changes that causes the firm to produce a quantity of zero at a price of $15 in the short-run. Which of the changes below can explain the change in the firm's behavior? O An increase in the fixed cost and a decrease in the marginal cost. O An increase in the fixed cost. O An increase in the marginal cost. O A decrease in the market price.
Which of the following is not a characteristic of a perfectly competitive market structure? O All firms sell identical products. O There are restrictions on exit of firms. O There are a very large number of firms that are small compared to the market. O There are no restrictions to entry by new firms.
If price is greater than average variable cost and less than average total cost at the profit-maximizing quantity of output in the short run, a perfectly competitive firm will: shut down production. O produce at an economic profit. O produce at an economic loss. O produce more than the profit-maximizing quantity.
Suppose that marginal revenue for a perfectly competitive firm is $20. When the firm produces 10 units, its marginal cost is $20, its average total cost is $22, and its average variable cost is $17. Then to maximize its profit in the short run, the firm A) should stay open and incur an economic loss of $20. B) must decrease its output to increase its profit. C) must increase its output to increase its profit. O D) should not change its production because it is already maximizing its profit and is making an economic profit. E) should shut down.
20) What will a firm in a perfectly competitive industry do in the short-run if the price of its product decreases below the firm's average variable costs but still above average total costs? A) Do nothing B) Increase production C) Decrease production D) Shut down
Suppose a perfectly competitive firm is experiencing short run economic losses. The firm will remain in the industry as long as a) marginal revenue equal to marginal cost b) price is greater than its minimum average variable cost O c) total revenue and total cost d) total revenue and average total cost
Which of the following best describes the short-run supply curve for an individual perfectly competitive firm? Select one: a. It is the vertical axis at prices less than minimum average variable cost and is the firm's marginal cost curve at prices above minimum average variable cost. Ob. It is the upward-sloping part of the firm's marginal cost curve. O c. It is the firm's marginal cost curve. Od. It is the vertical axis at prices less than minimum average total cost and is the firm's marginal cost curve at prices above minimum average total cost.