Essentials of Economics (MindTap Course List)
7th Edition
ISBN: 9781285165950
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Chapter 13.1, Problem 1QQ
To determine
The
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When a competitive firm doubles the amount it sells, what happen to the price of its output and its total revenue
Explain how demand is seen by a purely competitive seller.
“An upward – sloping demand curve doesn’t make sense in my business. All I know is that if I raise my prices, revenue doesn’t go up, it goes down. I don’t sell more products, I sell less. “Can you straighten out this business man’s thinking?
Chapter 13 Solutions
Essentials of Economics (MindTap Course List)
Ch. 13.1 - Prob. 1QQCh. 13.2 - How does a competitive firm determine its...Ch. 13.3 - Prob. 3QQCh. 13 - Prob. 1QRCh. 13 - Prob. 2QRCh. 13 - Prob. 3QRCh. 13 - Prob. 4QRCh. 13 - Prob. 5QRCh. 13 - Prob. 6QRCh. 13 - Prob. 7QR
Ch. 13 - Prob. 8QRCh. 13 - Prob. 1QCMCCh. 13 - Prob. 2QCMCCh. 13 - Prob. 3QCMCCh. 13 - Prob. 4QCMCCh. 13 - Prob. 5QCMCCh. 13 - Prob. 6QCMCCh. 13 - Prob. 1PACh. 13 - Prob. 2PACh. 13 - Prob. 3PACh. 13 - Prob. 4PACh. 13 - Prob. 5PACh. 13 - Prob. 6PACh. 13 - A firm in a competitive market receives 500 in...Ch. 13 - Prob. 8PACh. 13 - Prob. 9PACh. 13 - Prob. 10PACh. 13 - Prob. 11PACh. 13 - Prob. 12PA
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- How does a market compete with other firms efficiently to maintain profit in a competitive market over time? Show diagram with shifts in price, cost, quantity, etc.arrow_forwardWhat is the slope of average revenue curve in a market In which firm can sell more only by lowering the price?arrow_forwardSleek Sneakers Co. is one of many firms in the market for shoes. Show the effect that positive profits has on the demand curve faced by Sleek in the long run. Price Quantity Demand 中 Demand ?arrow_forward
- For each of the following, is the business a price-taking producer? Explain your answers. a. A cappuccino café in a university town where there are dozens of very similar cappuccino cafés. b. The makers of Pepsi-Cola. Just answer a.arrow_forwardSuppose that in the short run perfectly competitive firms earn $1,250 in economic profit. Would we expect to see more, less, or the same number of firms operating in the market in the long run?arrow_forwardConsider the perfectly competitive market for pineapples, which is in long-run equilibrium. Now income increases (we may assume that pineapples are a normal good). As a result, we would expect that The short-run profits stay the same The long-run profit for each firm increases. The short-run quantity for each firm increases The long-run quantity produced by each firm increasesarrow_forward
- In the market for running shoes, all the firms face a similar demand curve and have similar cost curves to those of Smart in question 3. a. What happens to the number of firms producing running shoes in the long run? Answer: b. What happens to the price of running shoes in the long run? Answer: c. What happens to the quantity of running shoes produced by Smart in the long run? Answer: d. What happens to the quantity of running shoes in the entire market in the long run? Answer: e. Does Smart shoes have excess capacity in the long run? Answer: f. Why, if Smart firm shoes has excess capacity in the long run, doesn’t the firm decrease its capacity? Answer: g. What is the relationship between Smart Shoes’ price and marginal cost? Answer:arrow_forwardFor a perfectly competitive firm, what is the relationship between Price and Marginal Revenue?arrow_forwardGraph the demand curve for a pure competitive firm, label the graph. What is the relationship between marginal revenue (MR) and the demand curve (is MR greater, equal, or less than the demand curve)?arrow_forward
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