A perfectly competitive firm decides to shut down if: O the price falls below the average-total-cost. O the price falls below the marginal cost. average revenue falls below the average-variable-cost. O the average revenue curve lies below the marginal cost curve. the total revenue is less than total cos

Q: 10 20 30 40 50 60 Quantity (units per day)

A: The given figure represents the case of a perfect competition market. This is a market structure…

Q: 1. Calculating the price elasticity of demand Suppose that during the past year, the price of a…

A: Price of laptop decreases from $2,350 to $1,930 and quantity increases from 436,000 to 537,000.…

Q: In a long-run competitive equilibrium, a restaurant owner who is just willing to continue operations…

A: When we talk about a perfect competitive market structure, we're talking about a market system where…

Q: Suppose a perfectly competitive firm is incurring an economic loss. Consequently, the i) firm's…

A: When, Price > ATC Firm earns an economic profit   Price = ATC Firm earns zero economic profit…

Q: Given a perfectly competitive firm, which of the following statements are true? Select one or more:…

A: In perfect competition, there exists a large number of firms selling identical goods. There is free…

Q: Consider a perfectly competitive firm with marginal cost (MC) and average total cost (ATC) given in…

A: In a perfectly competitive market there are large number of firms producing similar and identical…

Q: Suppose that price is below the current average total cost (ATC) but above the current average…

A: In economics, perfect competition is a theoretical market structure with the following…

Q: n increasing-cost industry is so named because of the positive slope of which DA. Each firm's…

A: Long run average total cost curve is a curve that shows a relationship between Average total cost…

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: When price and marginal cost are equal for a perfectly competitive fırm, the firm is O earning…

A:

Q: At the profit-maximizing level of output, O marginal revenue equals average total cost. O marginal…

A: ‘Maximizing Profit’  is considered to be a strong goal of a typical pay firm. This means selling a…

Q: According to Figure 10.2, the break-even price of the firm is: O $10. O $35. O $30. O $20. O $50.

A: Given options for the break-even price:$10$35$30$20$50

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: A perfectly competitive firm's demand curve is Select one: O a perfectly inelastic O b. the same as…

A: Perfectly competitive market refers to that market in which the products are of homogeneous nature…

Q: Suppose a perfectly competitive firm's demand curve is below its average total cost curve.  Explain…

A: Short run: It is the certain period having atleast one fixed input and othera are variable.

Q: To maximize its profit, in the short run a perfectly competitive firm decides O A) how much…

A: Perfect competition market where large numbers of buyers and sellers exchange homogeneous product at…

Q: Suppose a perfectly competitive firm faces the following short-run cost and revenue conditions: ATC=…

A: A perfectly competitive firm is a price taker, and that implies that it should acknowledge the…

Q: Suppose a perfectly competitive firm faces the following short-run cost and revenue conditions: ATC=…

A: Introduction We have given perfectly competitive firm. Profit maximizing condition is when MC = MR.…

Q: Firm Market Demand S2 ATC AVC MC Quantitv Quantitv firms in the market are producing output but are…

A: Answer: Note: You have not provided the options for blanks so the answer may differ. (1). If firms…

Q: COSI MC ATC AVC MR 15 14 11 750 1,100 1,350 1,800 Quantity Figure 12-5 shows cost and demand curves…

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…

Q: Suppose that a firm in a competitive market has the following cost curves: PRICE 20 18 16 41312 10 8…

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

Q: Exhibit: Perfectly Competitive Firm Price per unit MC ATC $3.00 P. 2.00 1.90 1.00 100 250 300 400…

A: A perfectly competitive firm maximizes profit by producing at d=MC. It accepts the market price as…

Q: The industry in the figure below consists of many firms with identical cost structures, and the…

A: The supply curve is the willingness to produce or sell a particular good or service in the market…

Q: Assume that there are 100 identical company in the perfectly competitive cabbage industry. Each firm…

A: The short run cost curve is given as The market demand curve is given as Q = 1500 - 50P There are…

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: In the long run, a perfectly competitive firm makes O A) either a positive economic profit or a…

A: Perfectly competitive market is the market in which all firms produce homogeneous product and sell…

Q: A firm produces a product in a perfectly competitive industry and has a short-run total cost…

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

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: If firms in a perfectly competitive industry are experiencing economic losses, cause industry supply…

A: In perfectly competitive market, there are many firms producing identical goods.

Q: Consider the total revenue (TR), total cost (TC), and total variable cost (TVC) curves shown at…

A: Every firm wants to achieve revenue that is higher than the total cost that they indulge in the…

Profit Maximization

Economic activity is related to the use of scarce resources of the economy that are used for producing goods and services which are required to satisfy various demands of the people. In other words, it can be said that it is all about satisfying the unlimited demands of individuals with the limited resources available. The production decision is taken by the producers or the firms. In economics, the terms ‘producers’, ‘suppliers’, and ‘firms’ are interchangeable. Now the question arises, what does a firm actually mean?