Under perfect competition a firm will increase output if:      A) marginal cost equals marginal revenue. B) marginal revenue equals average revenueC) marginal cost is less than price. D) price exceeds marginal revenue.

Perfect Competition in the long run:  Group of answer choices .results in both productive and allocative efficiency results in neither productive or allocative efficiency results in allocative but not productive efficiency results in productive efficiency but not allocative efficiency

Which of the following is NOT an assumption of perfect competition? Select one.  1.There are no restrictions on entry into the market 2. There are many buyers 3.There are many firms, each selling an identical product 4. The price each firm sets differs from the prices set by the other firms

8) Which of the following is not a characteristic of a perfectly competitive market structure? A) There are a very large number of firms that are small compared to the market. B) All firms sell identical products. C) There are no restrictions to entry by new firms. D) There are restrictions on exit of firms.

A perfectly competitive firm is making losses in the short run. The market price will increase in the long run. True False

Consider a perfectly competitive market that was in a long-run equilibrium when a permanent increase in demand occurs. Which of the following will occur as a result? i. The existing firms will start to earn an economic profit. ii. New firms will be motivated to enter the market. iii. Some firms that cannot meet the new demand will exit the market. A) i and ii only B) ii and ii only C) i and iii D) ii only E) i, ii and ii

A competitive firm maximizes profit when marginal cost: a. equals the price. b. is less than the price. c. is minimized. d. is greater than the price.

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.

Profits are maximized at the output at which marginal cost equals marginal revenue. If the market price falls below the minimum average variable cost: * the firm should shut down. the firm should produce more. the firm should produce less. the firm should make a discount in amount of marginal cost None of the above.

Refer to the figure above. When the demand curve is given by P2 = $15, this firm should ______ A. continue to operate in the short run and think about shutting down in the long run B. discontinue operation in the short run since there is a loss when operating. C. keep operating as long as loss is not greater than total cost D. discontinue operation in the short run since average total cost is greater than price.   When the demand is P3 = $10, this firm should ______ A. continue to operate in the short run and think about shutting down in the long run B. discontinue operation in the short run since the firm is unable to cover variable costs. C. keep operating as long as loss is not greater than total cost D. discontinue operation in the short run since average total cost is greater than price.