Choose the statement about a perfectly competitive market that is correct. O A. The market supply curve is the vertical sum of all of the individual supply curves in the market. O B. The market supply curve is upward sloping at prices above the shutdown price. OC. Each firm takes the market price as given and produces as much as possible. O D. The market demand curve is horizontal at the market price.

Choose the statement about a perfectly competitive market that is correct. O A. The market supply curve is the vertical sum of all of the individual supply curves in the market. O B. The market supply curve is upward sloping at prices above the shutdown price. OC. Each firm takes the market price as given and produces as much as possible. O D. The market demand curve is horizontal at the market price.

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

Don't used pen paper
Because perfectly competitive firms are price takers, a permanent increase in the market demand does not change the price of the product in either the short run or long run. O A. True O B. False
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.
| $100 Price (per unit) A. OB. O Ü Quantity (units per week) OD. MC A perfectly competitive firm will maximize profits by producing the level of output that corresponds to point ATC D Market Price P=MR
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.
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.
A firm in a competitive market has the following cost structure: Output 0 1 2 3 4 5 Total Cost $5 $10 $12 $15 $24 $40 if the market price is $16, this firm will O a. produce 5 units of output in the short run and face competition from new market entrants in the long run. O b. shut down in the short run and exit in the long run. Oc. produce 5 units of output in the short run and exit in the long run. O d. produce 4 units of output in the short run and exit in the long run.