Economics (Irwin Economics)
21st Edition
ISBN: 9781259723223
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Question
Chapter 11.6, Problem 1QQ
To determine
Price determination.
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Chapter 11 Solutions
Economics (Irwin Economics)
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Similar questions
- The attached figure shows the short-run cost curves for a perfectly competitive firm. If the price of the product were $8, and the firm does not close, the firm's short-run output will be:a. 0 (zero)b. between 0 (zero) and 10c. 10 or mored. Cannot be determined unless more information is available.Please elaborate on your answer to each alternative, whether it is true, false or uncertain.arrow_forwardThe long-run competitive market supply curve is: a)The portion of the firms MC curve that is above the ATC curveb)The portion of the firms MC curve that is above the AVC curvec)The horizontal summation of all the firm’s short-run supply curvesd)A curve that is equal to the minimum of ATCe) a) and d)arrow_forwardYou are the manager and selling your product in a perfectly competitive firm market. Your firm and other firms sell the product at a price of RM 90. Your cost function is C(Q) = 50 + 10Q + 2 Q2. What level of output should you choose to maximize profits? What are your firm’s short run profits? What will happen in your market in the long run? Explain.arrow_forward
- Draw the short run marginal cost curve for a firm with eventually diminishing marginal product. Then, draw an associated average variable and average total cost curve. Indicate the quantity associated with minimum average variable and average total cost. Then, indicate the price at which a firm is indifferent between shutdown and exit and the price at which a firm is indifferent between entry and exit.arrow_forwardA competitive firm’s short-run supply curve is its_________ cost curve above its _________ costcurve.a. average-total-; marginalb. average-variable-; marginalc. marginal-; average-totald. marginal-; average-variablearrow_forwardIn the short run, when average variable cost of production is less than the price, a price takers firm will set production to: A zero B Where MC=MR C Where TR=TC D Where AC=MR E Where p = ACarrow_forward
- Bob's lawn mowing service is a profit maximizing, competitive firm. Bob mows lawns for $27 each. His total cost each day is $280, of which $30 is a fixed cost. He mows 10 lawns a day. What can you say about Bob's economic and accounting profits in the short run ? A. Economic profits are minus $10 and accounting profits are $20 B.Economic profits are $20 and accounting profits are minus $10 C. None Which one?arrow_forwardSuppose perfect competitive firm short run cost function total cost=1/3q3+3q2+10Q+40 . if the market price of the commodity is birr 26 per unit A, determine the profit maximizing level of out put B find average fixed cost ,average cost ,average variable cost and marginal cost of firm at optimum level of out put C find maximum profit of the firmarrow_forwardExplain: “The short-run rule for operating or shutting down is P > AVC, operate; P < AVC shut down. The long-run rule for continuing in business or exiting the industry is P >= ATC, continue; P < ATC, exit.”arrow_forward
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