Good Zis produced and sold in a competitive industry, and long-run industry supply is characterized by constant costs. The figure below shows a typical long-run average cost curve (LAC) for each of the firms producing good Z. LAC reaches its minimum unit cost of $12 and 1,000 units of output (point M. Suppose the demand for good Zis Qg 52,000 -1,000P. LAC M 12.00 Firm's output (q) 1,000 In long-run competitive equilibrium, if demand for good Z decreases, then LMC rises, stays the same), and economic profit (falls, rises, stays the same). LAC (talls, (falls, rises, stays the same). in iong-run competitive equionum, it oemana tor goo0 z oecreases, tnen LMU rises, stays the same), and economic profit (rais, nses, stays tne samej, LAL (rars, (falls, rises, stays the same). Multiple Choice remains the same, remains the same; remains the same remains the same, falls fals fals, fals, falls remains the same; falls remains the same. fals, falls remains the same Price and cost (dollars)

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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Good Zis produced and sold in a competitive industry, and long-run industry supply is characterized by constant costs. The figure below shows a
typical long-run average cost curve (LAC) for each of the firms producing good Z. LAC reaches its minimum unit cost of $12 and 1,000 units of output
(point M. Suppose the demand for good Z is Qd 52,000 - 1,000P.
LAC
M.
12.00
1,000
Firm's output (q)
In long-run competitive equilibrium, if demand for good Z decreases, then LMC
rises, stays the same), and economic profit
(falls, rises, stays the same). LAC
(falls,
(Talls, rises, stays the same).
in iong-run compeuuve equibnum, it oemana tor good z oecreases, tnen LML
rises, stays the same), and economic profit.
(tais, rses, stays tne samej, LAL
(rars
(falls, rises, stays the same).
Multiple Choice
remains the same, remains the same, remains the same
remains the same, falls, falls
fals, fals, fals
remains the same; fals remains the same
falls, falls, remains the same.
Price and cost (dollars)
Transcribed Image Text:Good Zis produced and sold in a competitive industry, and long-run industry supply is characterized by constant costs. The figure below shows a typical long-run average cost curve (LAC) for each of the firms producing good Z. LAC reaches its minimum unit cost of $12 and 1,000 units of output (point M. Suppose the demand for good Z is Qd 52,000 - 1,000P. LAC M. 12.00 1,000 Firm's output (q) In long-run competitive equilibrium, if demand for good Z decreases, then LMC rises, stays the same), and economic profit (falls, rises, stays the same). LAC (falls, (Talls, rises, stays the same). in iong-run compeuuve equibnum, it oemana tor good z oecreases, tnen LML rises, stays the same), and economic profit. (tais, rses, stays tne samej, LAL (rars (falls, rises, stays the same). Multiple Choice remains the same, remains the same, remains the same remains the same, falls, falls fals, fals, fals remains the same; fals remains the same falls, falls, remains the same. Price and cost (dollars)
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