Question 19Consider the table below which presents information about a competitive firm:FIRMDPRICEOUTPUTTOTAL REVENUETOTAL COSTSTOTAL FIXED COSTSTOTAL VARIABLE COSTSAVERAGE TOTAL COSTS?700$2,800$2,975?$2,450?AVERAGE VARIABLE COSTS?MARGINAL COST$4.00Is this firm maximizing short run profits (minimizing short run losses)?a) No. ATC is greater than P.b) Yes. P MC.c) Yes. PAVC.0 / 10 points

All the questions solved above use the below formulas and definitions or their variations, such as:…

Answered: Question 19 Consider the table below…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

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-run abnormal 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’s payoff/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?
Consider the perfectly competitive market for sports jackets. The following graph shows the marginal cost ( MCMC ), average total cost ( ATCATC ), and average variable cost ( AVCAVC ) curves for a typical firm in the industry.
The packaged milk market in Pakistan is perfectly competitive. (1) Some firms in the market are making profit, others are having losses. Draw and explain graphs showing MC, ATC, MR, AR, price and quantity of output to illustrate these situations. (2) In the short run some of these firms may decide to shut down temporarily. In the long run some of these firms may exit the market, and new firms may enter. Draw and explain graphs to show these situations and short run and long run supply curves. (3) If firms can enter and exit the packaged milk market in the long run but not in the short run, show how a decrease in demand due to lower incomes of Pakistani consumers during COVID Pandemic affects price and profitability.
37) In a perfectly competitive industry, the market price of the product is $15. Firm A is currently producing 300 units. The firm's marginal cost is $15, its fixed costs amount to $1000 and its average variable cost equals $10. Which one of the following is true for this firm?a) it’s profits are 500 $b) it’s profits are -500 $c) it’s profits are -1500 $d) it’s profits are 1500 $
What relationship determines whether or not a firm should stay open in the short run? A) The price of the goods it sells and its average total cost. B) The price of the goods it sells and its average variable cost. C) The marginal revenue of the goods it sells and its average total cost. D) The marginal revenue of the goods it sells and its average variable cost.
The canola farming industry is perfectly competitive. Assume that it is in long-run equilibrium at quantity Q0 and price P0. Assume also that it is a constant-cost industry. a) Draw a supply and demand diagram for the canola market showing this equilibrium b.) draw diagram for a typical canola growing farm in its initial long run equilibrium, showing its Marginal Cost, Average Total Cost, and Long Run Average Cost curves. Are there any profits being made by this firm?
Use the figure below to answer the following question. Total revenue and total cost (dollars) 400 300 Z 200 100 Q 0 99 Quantity Figure 12.2.1 Refer to Figure 12.2.1, which shows a perfectly competitive firm's total revenue and total cost curves. Which one of the following statements is false? A) At an output of Q1 units a day, the firm makes zero economic profit. B) At an output less than Q1 units a day, the firm incurs an economic loss. OC) At an output of Q2 units a day, the firm incurs an economic loss. D) Economic profit is the vertical distance between the total revenue curve and the total cost curve. E) At an output greater than Q3 units a day, the firm incurs an economic loss. Main Content
Use the table below listing Average Total Cost (ATC)d and Marginal Cost (MC) for a firm in perfect competition to answer the following questions. Quantity ATC MC 1 17.5 15 14.3 12 3 10 10 4 16 20 22 31 In each scenario determine if the firm is profitable, breaks even, or incurs a loss. 1. If market price is $8, the firm 2. If market price is $14, the firm 3. If market price is $10, the firm
Use the values for a perfectly competitive firm below to answer the questions: Price Quantity Total Cost Fixed Cost Variable Cost $10 2,000 $24,000 $8,000 $16,000 (A) Should this firm shut down in the short run? (B) Assume this firm's total costs do not change in the long run. Should this firm exit in the long run? (C) Are your answers to (a) and (b) different? Explain in one to four sentences.
In the above figure, The cost curves of a typical perfectly competitive curve are show. What will price settle at in the long run?
C. Table below shows some cost data for a perfectly competitive firm i. Is the firm operating in the short run or long run? How do you know?ii. At a market price of $32, what would be the output of the firm? Does this firm makeeconomic profit or loss at this price level? iii. If the market price is $32, would the firm shut down or keep operating? Why? iv. Based on your answer above, would firms enter or exit the market in the long run? What will happen to the market price?
Using diagrams for both the industry and a competitive firm, illustrate competitive long-Run equilibrium, how much profit they will earn elaborate precisely. Assuming constant costs in competitive market employ these diagrams to show how (a) an increase and (b) a decrease in market demand will upset that long run equilibrium.

SEE MORE QUESTIONS

Recommended textbooks for you

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

Principles of Economics (MindTap Course List)

Economics

ISBN:

9781305585126

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Managerial Economics: A Problem Solving Approach

Economics

ISBN:

9781337106665

Author:

Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:

Cengage Learning

Managerial Economics & Business Strategy (Mcgraw-…

Economics

ISBN:

9781259290619

Author:

Michael Baye, Jeff Prince

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS