It is less important for firms that sell commodities to have a competitive advantage. O a. True, a competitive advantage is not useful for commodity firms because they are usually a monopoly with no competitors O b. True, the most important factor for commodity firms is lower prices O c. False O d. True, the most important factor for commodity firms is lower costs O e. True, the most important factors for commodity firms are both lower costs and lower prices

It is less important for firms that sell commodities to have a competitive advantage. O a. True, a competitive advantage is not useful for commodity firms because they are usually a monopoly with no competitors O b. True, the most important factor for commodity firms is lower prices O c. False O d. True, the most important factor for commodity firms is lower costs O e. True, the most important factors for commodity firms are both lower costs and lower 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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Economic efficiency is O A. a market outcome in which the marginal benefit to consumers of the last unit produced is greater than its marginal cost of production and in which the sum of consumer surplus and producer surplus is at a maximum. O B. a market outcome in which the marginal benefit to consumers of the last unit produced is equal to its marginal cost of production and in which the sum of consumer surplus and producer surplus is at a maximum. O C. a market outcome in which the marginal benefit to consumers of the last unit produced is equal to its marginal cost of production and in which the sum of consumer surplus and producer surplus is not at a maximum. O D. a government outcome in which the marginal benefit to consumers of the last unit produced is equal to its marginal cost of production and in which the sum of consumer surplus and producer surplus is at a maximum.
2. Suppose that the market for wind chimes is a competitive market. The following graph shows the daily cost curves of a particular firm operating in this PRICE (Dollars per wind chime) 40 36 32 28 24 20 16 2 8 4 0 0 MC 2 ATC AVC 6 4 8 QUANTITY (Thousands of wind chimes per day) + 10 12 14 16 18 20 market: a) In short run, at a market price of $26 per wind chime, how much will firm choose to produce per day? How do you know? b) If the market price is $26 in the short run, and the firm chooses to produce the quantity you obtained in question (a), indicate the area that represents firm's profit or loss in short run on the graph. c) What is this firm's shutdown price, that is the price below which it is optimal for the firm to shut down in short run? d) long run, all firms can enter and exit the market, and all entram the same costs as above. As this mark
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O b. $80 Given that the firm decides to only offer the high-end wok, what is the highest price it can charge the chefs? O a. $70 O c. $90 Cooking Wok No-name brand High-end professional series O d. $100 Use the following table for questions 50-57 Value to home users $50 $70 Value to professional Chefs $60 $100
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