Consider a firm whose cost of producing each unit is the same at all output levels. Which of the following statements is correct regarding its isoprofit curves? Select one: Each isoprofit curve depicts the firm's profit for different outputs for a given price of the output O a. good. O b. The isoprofit curves are upward-sloping. O c. The isoprofit curves cannot cross. O d. The higher the price the higher the profit, so constant profits imply constant prices.

Consider a firm whose cost of producing each unit is the same at all output levels. Which of the following statements is correct regarding its isoprofit curves? Select one: Each isoprofit curve depicts the firm's profit for different outputs for a given price of the output O a. good. O b. The isoprofit curves are upward-sloping. O c. The isoprofit curves cannot cross. O d. The higher the price the higher the profit, so constant profits imply constant prices.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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*Suppose that the development of a new droughtresistanthybrid seed corn leads to a 50 percent increase in the averageyield per acre without increasing the cost to the farmers who usethe new technology. If the producers in the corn production industrywere price takers, what would happen to the following?a. the price of cornb. the profitability of corn farmers who quickly adopt thenew technologyc. the profitability of corn farmers who are slow to adopt thenew technologyd. the price of soybeans, a substitute product for corn
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Which of the following best explains why a firm would not stop producing if the loss is less than its fixed costs? O Fixed costs are paid regardless of whether something or nothing is produced, and the firm receives enough revenue per unit to cover ATC and some MC. O Fixed costs are paid regardless of whether something or nothing is produced, and the firm receives enough revenue per unit to cover ATC and some FC. O Fixed costs are paid regardless of whether something or nothing is produced, and the firm receives enough revenue per unit to cover AVC and some FC. O Fixed costs are paid regardless of whether something or nothing is produced, and the firm receives enough revenue per unit to cover AVC and some MC.
What is a price taker? A price taker is O A. a firm with a downward-sloping demand curve. O B. a firm that is unable to affect the market price. Oc. a firm with a perfectly inelastic demand curve. O D. a firm that has the ability to charge price greater than marginal cost. O E. a firm that does not seek to maximize profits. When are firms likely to be price takers? A firm is likely to be a price taker when O A. it sells a differentiated product. O B. barriers to entry are substantial. OC. it has market power. O D. it represents a small fraction of the total market,. O E. firms in the industry collude.
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