Q: A perfectly competitive firm will shut down when the price is just below the minimum point on the A)…
A: A competitive firm produces output where P= MC but at this output firm may earn profit or loss.
Q: Can a perfectly competitive firm set its own market price?
A: Perfect or pure competition is a form of market in which a large number of perfectly informed buyers…
Q: Perfectly competitive firms maximize profits by choosing the profit-maximizing output level. They…
A: Perfect competition is the market structure where there are large no of buyers and sellers selling…
Q: Perfectly competitive firms maximize profits by choosing the profit-maximizing output level. They…
A: A perfectly competitive market is characterized by a large number of buyers and sellers in the…
Q: normal profit
A: There are different market structures like: ‘Perfect Competition’, ‘Monopoly’, ‘Monopolistic…
Q: In a perfectly competitive industry, long run equilibrium is characterized by OP MC OP> ATC
A: In the perfectly competitive market, a firms' Profit Maximizing constraint is different in short-run…
Q: must each perfectly competitive firm be in equilibrium if the industry is in the long-run…
A: Perfect competition refers to the situation where there are large number of prouder and consumers…
Q: If it is possible for a perfectly competitive firm to do better financially by producing rather than…
A: A perfectly competitive firm is a price taker and can sell any quantity of the commodity at the…
Q: Suppose that the market for candy canes operates under conditions of perfect competition, that it is…
A: First price was $0.10 Cost increased by 0.05 0.10+0.05=0.15
Q: For the demand curve facing a perfectly competitive firm is MR > Q > 0 P >MR < AR P= MR =…
A: A perfectly competitive firm is a price taker and can sell any quantity of the commodity at the…
Q: Show and explain how the short run supply curve of the perfectly competitive firm is derived.
A: in a perfectly competitive market there are large number of firms producing similar and identical…
Q: A perfectly competitive firm will be operating at its shutdown point if it operates at the minimum…
A: In a competitive market there are large number of firms selling identical products thus acting as a…
Q: Perfectly competitive firms earn zero economic profit in the long run. True False
A: In perfectly competitive market, price is constant so it is equal to marginal revenue. Profit is…
Q: economic profit, a firm at zero economic profits, or a firm operating at a loss.
A: When Price is higher (lower) then ATC, firms make economic profit (loss) and enter (leave) the…
Q: If price is consistently below average variable cost, then in the short run a perfectly competitive…
A: Average variable cost is given by AVC =TVCq
Q: Identify a perfectly competitive firm that you have purchased a good or service from in the last…
A:
Q: The shut-down point for a firm in a perfectly competitive industry is: P = MR P = ATC P = MC P =…
A: Average variable cost (AVC): - it is the average value of the cost incurred due to the employment of…
Q: Explain why a competitive firm’s marginal cost curve is the same as its supply curve.
A: In perfectly competitive market there are many sellers as well as buyers. Price is given that means…
Q: In a perfectly competitive market you can expect the following changes to occur in long run if firms…
A: The structure of a market where there are a large number of sellers selling homogenous products and…
Q: A perfectly competitive firm will shutdown if its a. Loss is greater than the fixed cost b. Marginal…
A: A perfectly competitive firm will shutdown if its Average total cost exceeds its average variable…
Q: n the short run, a perfectly competitive firm can Select one: a. earn an economic profit. b. earn an…
A: In a perfectly competitive market, the firm is a price taker and there is free entry and the exist…
Q: State and examine the characteristics for a perfectly competitive firm such as Dodi Ltd selling…
A: The market structure can be divided into four based on the degree of competition and the type of…
Q: In the short-run model of perfect competition, there is always a range of prices above the shutdown…
A: When talking about a perfectly competitive firm it can be seen that the firm will stay in the market…
Q: The graph depicts the average total cost curve for a perfectly competitive firm. At the long-run…
A: In a perfectly competitive market, price is constant at all levels of output so it is equal to…
Q: Based on the characteristics of perfectly competitive market explain why firms in this market are…
A: Perfect competition is a type of market structure in which there are large number of buyers and…
Q: Explain equilibrium of the firm under perfectly competitive market by choosing output level at which…
A: A competitive firm produces output where P=MC=MR. At this output it earns profit or loss depends on…
Q: Comment on the Demand curve of a firm operating in perfectly competitive market
A: Perfectly competitive market has many buyers and sellers and the good being sold is 100% homogenous…
Q: Which of the following is true of perfectly competitive firm that keeps producing in the short run?…
A: A perfectly competitive market is characterized by a large number of buyers and sellers. The price…
Q: If a perfectly competitive firm’s supply curve is given by Q = -18 + P, which of the following is…
A: The supply curve, Q = -18 + P
Q: The demand curve and supply curve for a perfectly competitive market are: Q = 500 – 5P and Q = 320 +…
A: Equating market demand = market supply, 500 - 5P = 320 + P 6P = 180 P = 30 Q = 320 + 30 = 350…
Q: Suppose that the perfectly competitive turkey industry is in long-run equilibrium at a price of $3…
A: Perfect competition: Under this market, the price prevails in the market is determined by the market…
Q: In the long-run, perfectly competitive firms produce at the point where P = ATC MR = MC P = MC All…
A: Perfectly competitive market refers to a market structure where there are many firms and buyers.…
Q: A perfectly competitive firm is in the following situation: output = 6000 units; market price = $2;…
A:
Q: draw a short run firm and industry competitive equilibriums for a perfectly competitive…
A: It is given that the alligator-farming industry is perfectly competitive and earns zero economic…
Q: When new firms enter a perfectly competitive market in which firms are making an economic profit,…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: TRUE OR FALSE If a perfectly competitive firm shuts down in the short run, its total cost equals…
A: Perfectly competitive firm are those whose are price taker . They take the price which is formed by…
Q: the profit maximization condition for a perfectly competitive firm in the short-run- is
A: Perfect competition is the market form that involves a large number of buyers and sellers in the…
Q: A perfectly competitive firm should shut down in the short-run if price falls below the minimum of…
A: A perfectly competitive market is the one where there are large number of buyers and sellers selling…
Q: A perfectly competitive firm is making a loss if
A: We have to find a perfectly competitive firm is making a loss.
Q: Suppose that the perfectly competitive turkey industry is in long-run equilibrium at a price of $3…
A: Answer: (1). Less (2). producing less quantity of turkey and running at a loss (or earning a…
Q: In the long run when a perfectly competitive firm experiences positive economic profits firms exit…
A: In perfectly competitive market, there is free entry and exit of firms.
Q: Consider a perfectly competitive barley producing sector in Western Canada with increasing costs and…
A: The markets in an economy are considered to be of utmost importance for the economic, and financial…
Q: . A competitive firm’s short-run supply curve is its ________ cost curve above its ________ cost…
A: 4. A competitive firm’s short-run supply curve is its________ cost curve above its ________ cost…
Q: Question When a perfectly competitive firm is at the profit maximizing output level what will be the…
A: Perfectly competitive market: In a perfectly competitive market structure, there exists a large…
Q: When a perfectly competitive market is in long-run equilibrium, the firms supplying in that market…
A: A perfectly competitive market is characterized by a large number of buyers and sellers. The market…
Q: Explain the three possible profit maximizing positions of perfectly competitive firms in the…
A: The various forms of market structure include perfect competition, oligopoly, monopoly, and…
Q: At the profit-maximizing output level, what will be the relationship between the perfectly…
A: A profit-maximizing output level is when that gives highest returns to the firm as any change in…
What is the short-run Shutdown condition for a
|
|
P>AVCminimum |
|
|
P<AVCminimum |
|
|
P>ATCminimum |
|
|
P<ATCminimum |
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- The graph contains the relevant cost curves for a perfectly (or purely) competitive firm. Move point A on the graph to the shutdown point. 1.000 MC 900 ATC In order for the firm to carn positive economic profits the price of the good must be above what value? B00 AVC 700 00 500 400 400 price of a good: $ 400.00 300 Incerrect 200 AFC What is the shutdown price for this firm? 100 400.00 100 200 300 400 500 000 700 B00 000 1,000 Quantity shutdown price: $ IncorrectMacmillan Learning Consider the graphs of a constant cost industry and a perfectly competitive firm within it. Initially, the industry is in long-run equilibrium at point E, then demand shifts from Demand1 to Demand2. Answer the questions where P is the price, MR is the marginal revenue, AR is the average revenue, MC is the marginal cost, SRATC is the short-run average total cost, and LRAC is the long-run average total cost. Manipulate both of the graphs to reflect the adjustments that yield the long-run equilibrium. Price ($) 10 9 8 7 6 5 4 3 2 1 0 0 10 20 9 8 7 6 XX 5 3 MC 2 1 E 60 30 40 50 Quantity (in thousands) The demand shift results in 70 Supply a short-run economic loss for the firm. Demand1 Demand2 10 80 90 100 0 0 10 20 SRATC 30 40 50 60 Quantity 70 80 LRAC P=MR=A 90 100TRUE OR FALSE If a perfectly competitive firm shuts down in the short run, its total cost equals zero.
- Which of the following would not help a firm to improve its competitive position?If Fatimah's Bee Farm is a perfectly competitive firm, the demand for Fatimah's honey has? 1. Zero elasticity 2. infinite elasticity 3. elasticity equal to the price of apples 4. unitary elasticitySparkle is one firm of many in the market for toothpaste, which is in long-run equilibrium. Indicate which of the following graphs accurately reflects Sparkle's demand curve, marginal-revenue (MR) curve, average-total-cost (ATC) curve, and marginal-cost (MC) curve. (?) ?) A B Demand Demand ATC ATC MC- MC- MR MR Quantity of Sparkle Toothpaste Quantity of Sparkle Toothpaste A B Price, Cost, Revenue Price, Cost, Revenue
- Answer the following, providing a graphical illustration along with your answer where necessary:a) What is the profit maximising condition in a market with perfect competition?b) Explain what is meant by abnormal profit? What is the adjustment process from short-runabnormal profit to long-run equilibrium in a perfectly competitive market?c) Please find below Pricing options for firm A and B, along with individual payoffs (Firm A’spayoff/Firm B’s payoff)Firm BFirm APrice £2 Price £1Price £2 £20,000/£20,000 £10,000/£24,000Price £1 £24,000/£10,000 £12,000/£12,000Assume you are the pricing manager at Firm A;i) What is your payoff for a ‘maximin’ strategy?ii) What is your payoff for a ‘maximax’ strategy?iii) Does a dominant strategy exist within this prisoners’ dilemma?Answer the following, providing a graphical illustration along with your answer where necessary:a) What is the profit maximising condition in a market with perfect competition?b) Explain what is meant by abnormal profit? What is the adjustment process from short-runabnormal profit to long-run equilibrium in a perfectly competitive market?c) Please find below Pricing options for firm A and B, along with individual payoffs (Firm A’spayoff/Firm B’s payoff)Firm BFirm APrice £2 Price £1Price £2 £20,000/£20,000 £10,000/£24,000Price £1 £24,000/£10,000 £12,000/£12,000Assume you are the pricing manager at Firm A;i) What is your payoff for a ‘maximin’ strategy?ii) What is your payoff for a ‘maximax’ strategy?iii) Does a dominant strategy exist within this prisoners’ dilemma? QUESTION A AND B ALREADY SOLVED, FROM C ONLY !!!Why does a purely competitive firm not charge price above the market price?
- A firm operating under perfectly competitive market experience normal profit whenConsider the competitive market for rhodium. Assume that no matter how many firms operate in the industry, every firm is identical and faces the same marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves plotted in the following graph. COSTS (Dollars per pound) 80 2233 22 72 64 56 80 48 72 64 56 48 40 00 32 24 16 0 0 MCD ATC Demand 0 AVC The following graph plots the market demand curve for rhodium. -0. ☐ 3 6 9 12 15 18 21 QUANTITY (Thousands of pounds) D Use the orange points (square symbol) to plot the initial short-run industry supply curve when there are 10 firms in the market. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output since this is the industry supply curve.) Next, use the purple points (diamond symbol) to plot the short-run industry supply curve when there are 20 firms. Finally, use the green points (triangle symbol) to plot the short-run industry supply curve when there are 30…Crabby Bob’s is a seafood restaurant in a beach resort in Delaware. Crabby Bob’s earns a profit each month from May through September, suffers losses in October, November, and April but remains open, and remains closed from December through March. Given that the restaurant market in this town is perfectly competitive, how would you explain Crabby Bob’s decisions?
