When large retailers like Costco offer products at a discounted price because they are able to negotiate cheaper rates with their suppliers compared to smaller competitors, they benefit from O Availability of compliments. O Learning-curve effects. O Experience-curve effects. O Economies of scale.

When large retailers like Costco offer products at a discounted price because they are able to negotiate cheaper rates with their suppliers compared to smaller competitors, they benefit from O Availability of compliments. O Learning-curve effects. O Experience-curve effects. O Economies of scale.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A firm facing a demand curve will have zero quantity demanded if it raises its price above the market price. a. perfectly elastic O b. relatively elastic O c. relatively inelastic O d. perfectly inelastic A perfectly competitive firm is breaking even. In the short run it should In the long run it should a. produce where MC = MR; keep the same production level O b. produce where MC = MR; leave the industry O c. shut down; exit the industry O d. shut down; expand
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Perfect competition an efficient outcome because O A. achieves; total surplus is maximized O B. achieves; marginal benefit equals marginal cost OC. does not achieve; firms do not get to choose their price O D. does not achieve; firms produce goods with perfect substitutes O E. Both A and B are correct.
A local pizzeria only servers two items: pizzas and sandwiches. An increase in the demand for sandwiches will result in which of the following for the firm? O an increase the opportunity cost of producing pizzas O an increase in the amount of resources the firm devotes to producing pizzas O a decrease in the price of bread a decrease in the price of sandwiches a decrease in the firm's overall revenue
In a competitive market with free entry and exit from the market a permanent rise in demand will lead to Select one or more: O a. excess profits being made in the short run (before new firms can enter) O b. entry by new firms O c. a permanent rise in prices O d. normal profits being made in the long-run
If a firm is a price-taker, then Select one: O a. marginal revenue is equal to price O b. the firm can sell as much output as it likes at the market-determined price O c. marginal revenue is equal to total revenue O d. both a and b
Assume that marginal revenue equals rising marginal cost at 100 units of output. At this output level, a profit-maximizing firm's total fixed cost is $600 and its total variable cost is $400. If the price of the product is $8 per unit, the firm should produce O less than 100 units of output. O The amount is impossible to determine from the information given. O 100 units of output. O more than 100 units of output.
Price and cost MC ATC AVC $40.50 36.00 MR 30.00 22.00 20.00 130 180 240 Quantity Suppose the Price is at $20. What is total revenue at the profit-maximizing quantity? 3960 O 20 O 7200 O 2600
The short-run elasticity of supply curve is steep because O A. diminishing marginal returns restrict output in the short run. OB. production facilities have a fixed capacity in the short run. OC. new firms enter the market with new production facilities. OD. of both A and B. SURU O E. All of the above.
If a graph is used to compare total revenue and total cost of a perfectly competitive firm, then the horizontal axis of the graph will represent the and the vertical axis will represent OA. price, measured in dollars; quantity of goods produced O B. total costs measured in dollars; quantity of goods produced O C. quantity produced; both total revenue and total costs, measured in dollars. O D. quantity produced; total revenue and total variable costs, measured in dollars.
Assume Cathy's Cupcake Company operates in a perfectly competitive market producing 10,000 cupcakes per day. At this output level, marginal cost exceeds this firm's price. Assuming price exceeds average variable cost, to maximize profits Cathy's should O a. stop producing since it is earning a loss. O b. decrease their output. Oc make no adjustments as they are already maximizing their profits. Od. increase their output. Both Stan and Kyle own potato chip factories. Stan's factory has low fixed costs and high variable costs. Kyle's factory has high fixed costs and low variable costs. Currently, each factory is producing 5.000 bags of potato chips at the same total cost. Complete the following statement with the correct answer. If each produces more, the costs of Kyle's factory will exceed those of Stan's factory. Ob. more, their costs will be equal. less, the costs of Kyle's factory will exceed those of Stan's factory. Od. less, their costs will be equal. If a firm is producing where…