When might a competitive firm shutdown in the short run and exit the market in the long run?

Q: In the long-run, any perfectly competitive firm that produces will choose a quantity such that

A: The market is a location where the transaction of services and commodities takes place. It is…

Q: How does a competitive firm determine the quantity that maximizes profit?

A: The markets are considered to be of utmost importance for the economies, because it assists in the…

Q: Assume that a firm in a perfectly competitive market is making a loss in the short run. In the long…

A: 1) Assume that the firm in a perfectly competitive market and in the short run, it is making a…

Q: Suppose the shirts industry is perfectly competitive and begins in a long-run equilibrium. (a)…

A: Perfect competition refers to the situation where there are many buyers and sellers exist in the…

Q: You read in a business magazine that farmers are reaping high profits. With the theory of perfect…

A: A perfect competition is a market structure where the price of the commodity sold is same and is…

Q: What type of economic profit can most firms expect to make in the long run? Explain your answer.

A: A market is a place where buying and selling of goods and services takes place.

Q: If the corn industry is perfectly competitive with a market price of $2 per bushel and a corn farmer…

A: A market formed by the agglomeration of a large number of firms identical in size that produce and…

Q: In the short run, if a competitive firm is making profit, the firm should produce. But if a…

A: A firm incurs losses if the total costs exceed the total revenue. The excess of the total cost over…

Q: Based on the given graph: a. If this firm profit-maximizes, how much output will it produce and…

A: Given;

Q: long run in the market (In other words, will other firms join the market or exit the market? 2) If…

A: In the competitive condition, each production unit lacks any degree of market power because of its…

Q: When will a firm enter a competitive market?

A: Perfect competition refers to the situation where there are large number of prouder and consumers…

Q: In class we said that the firms like firm X in perfect competition are price takers, it implies that…

A: Perfect competition is the one of structure of market in which many numbers ofbuyers and sellers…

Q: Assume firms decide to enter the market, how will this affect market price and quantity in the long…

A: In a market with perfect competition, every manufacturer offers the same products or services. There…

Q: The graph below shows a perfectly competitive firm in short run equilibrium, where the firm has…

A: The profit-maximizing output level is acquired at the intersection of the marginal cost and marginal…

Q: In the long-run, a perfectly competitive firm will earn what kind of economic profit?

A: In the long run, a perfectly competitive firm will earn normal/zero economic profit.

Q: The situation facing by firm “Smart”,  a producer of running shoes, is shown in the following…

A: A monopolistic firm shares similar profit-maximizing constraint as the monopoly firm according to…

Q: In the short run, a competitive firms supply curve is

A: A perfectly competitive firm is price taker in nature, and hence faced a horizontal demand curve.

Q: When will a firm neither enter or exit a competitive market?

A: In competitive market firms are free to enter and exit.

Q: When do firms decide to (i) stay in the market, (ii) shutdown the firm's operations, and (iii) exit…

A: 1) Stay in market In case there are benefits to be made, firms will stay the market as there are no…

Q: What are the Characteristics of a Purely Competitive Market?

A: Characteristics of a Purely Competitive Market:   The Purely competitive market is the market…

Q: Assume that apples are produced in a perfectly competitive market. Columbia’s Orchard is a typical…

A: b) Given the apples have become popular and their demand has increased. This would shift the demand…

Q: Are condominiums considered imperfect competition or perfect competition in the market?

A: Market structures can be classified into four major categories. The following states the market…

Q: Question 17 Referring to Figure 1 in Question 14, When price is $175, will firms enter or exit the…

A: Perfect competition is a type of market structure.

Q: You read in a business magazine that farmers are reaping high profits. With the theory of perfect…

A: Perfect competition is a market structure where are large numbers of buyers and sellers. The sellers…

Q: If a firm makes zero economic profit, it will exit the market in the long run. Do you agree?…

A: No economic profit is also referred as normal profit. Economic profit is calculated by subtracting…

Q: Explain how the long run differs from the short run in pure competition.

A: Perfect competition is a form of market in which a large number of perfectly informed buyers and…

Q: Is the firm making an economic profit or loss? Will firms enter or exit this market? 3. Sketch on…

A: 1. The firm is operating at the point where the marginal revenue equals the marginal cost in the…

Q: How equilibrium price is determined under perfect competition?

A: Under perfect competition, both producers and consumers are price takers.

Q: Briefly explain the reason for why in a competitive market we expect economic profits to be zero in…

A: A competitive market, also known as perfect competition, is a kind of market where there are a large…

Q: When is it the right time when a firm will enter a competitive market?

A: A competitive market is considered as one where firms have no opportunity to deviate from market…

Q: Suppose the market price of a good is $20 and TC=0.5Q2. A.   What Q should a profit maximizing…

A: A competitive firm is a price taker as there are large number of firms selling identical goods

Q: Which of the following is most likely to operate under a perfectly competitive market? 1) A…

A: Perfect competition is a market condition there is a large number of buyers and sellers selling an…

Q: g. What is the firm's profit if it shuts down? h. In the long run, should this firm continue to…

A: A producer or seller draws out highest amount of profits when its marginal revenue , the…

Q: You read in a business magazine that farmers are reaping high profits. With the theory of perfect…

A: Perfect competition is many sellers dealing in commodity which is same in quality and price at which…

Q: What are the long-run market equilibrium price and quantity of hibiscus plants? How many firms…

A:

Q: You read in a business magazine that farmers are reaping high profits. With the theory of perfect…

A: Perfect competition refers to the market structure where the number of buyers and sellers are large…

Q: How does a competitive firm determine its profit-maximizing level of out put? Explain. . When does a…

A: A competitive firm determines its profit maximizing level of output when P= MR= MC  When the…

Q: In the long run, a perfectly competitive firm can

A: The ideal kind of market structure is known as "perfect competition," and it occurs when all…

Q: ou read in a business magazine that computer firms are reaping high profits. With the theory of…

A: (a)   Assume that the computer industry is perfectly competitive. Earning high profit which attracts…

Q: 31. Which of the following is the best example of a perfectly competitive market? a. soft drinks b.…

A: Perfectly competitive market is characterized by the • many sellers  and many buyers • homogeneous…

Q: What are the characteristics needed for a perfectly competitive market?

A: In a perfect competitive market, there is a number of buyers and sellers, selling similar products.…

Q: -run equilibrium in a perfectly competitive market, firms earn positive economic profits.   Is…

A: A perfect competition is where there is free market entry for the firms. If the firm earns profits…

Q: What is special about a purely competitive market?

A: A perfectly competitive market is the market in which there is perfect competition amongst buyers…