If a perfectly competitive firm's average total cost is less than the price, then the firm A) incurs an economic loss. B) makes an economic profit. C) makes zero economic profit. D) makes either zero economic profit or an economic profit depending on whether the marginal revenue is equal to or greater than the price.

A perfectly competitive firm will choose to shut down when the average total cost intersects the marginal cost curve below the average variable cost curve

1) A perfectly competitive firm faces the following Total revenue, Total cost and Marginal cost functions: TR = 10Q TC = 2 + 2Q + Q2 MC = 2 + 2Q At the level of output maximizing profit, the above firm's level of economic profit is A) $0 B) $4 C) $6 D) $8 *Additional information after I did the math: The price this firm charges for its product is $10, the level of output maximizing profit is 4

In competitive markets economic profit becomes zero in the long-run. However, it is also possible for some firms to earn a greater accounting profit and to enjoy a higher producer surplus than other firms. How is it possible?

Draw the marginal revenue curve for a firm in perfect competition that produces rubber boots when the market price is​ $10 per pair. Label it.    Draw the marginal cost curve. Label it.    Draw the average variable cost curve if the price occurs at minimum average variable cost. Label it.    Draw a point to indicate the shutdown point.

A perfectly competitive firm can A) sell all of its output at the prevailing market price. B) set a higher price to customers who are willing to pay more. C) raise its price in order to increase its total revenue. D) sell additional output only by lowering its price. E) usually not sell all the output it produces, but still "over-produces" because there are some periods when it can sell the extra output at very profitable prices.

Consider the following costs of a typical firm in a purely competitive industry. The firm has no fixed cost given only the available information, what would you except product price to be in the long run?

In the short run, if a perfectly competitive firm chooses to produce, then its profits are maximized by producing the quantity of output where marginal cost equals marginal revenue. True False

The cost curves below are for a firm competing in a perfectly competitive industry. If the market price is $5, in the short - run a profit - maximizing firm would: Produce and earn a negative economic profit Not produce (as it leads to a negative profit) Produce and earn a normal profit Produce and earn a positive economic profit The cost curves below are for a firm competing in a perfectly competitive industry. If the market price is $5, in the short-run a profit-maximizing firm would: Price and cost 16 15 14 13 12 11 10 9 8 6 3 MO O Produce and earn a negative economic profit O Not produce (as it leads to a negative profit) O Produce and earn a normal profit O Produce and earn a positive economic profit ATC AVC 6 bis & Quantity

The graph below shows a perfectly competitive firm in short run equilibrium, where the firm has chosen the output level maximizing its profit. Consider the level of profits being earned here, and what will happen over time. What will happen in the long run? Note that the horizontal demand curve, D1, is also equivalent to marginal revenue and price.      Group of answer choices The market price will increase causing economic profits to increase Demand will increase causing economic profits to increase The market price will decrease until economic profit is zero