Econ Micro (book Only)
6th Edition
ISBN: 9781337408066
Author: William A. McEachern
Publisher: Cengage Learning
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Chapter 8, Problem 9P
To determine
The reasons for firms choosing to operate in a
Why firms choose to operate in perfect competition even though they earn no economic profits in the long run.
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(Table: Costs for Alina's Apple Pies) Use the table Costs for Alina's Apple Pies. If Alina's Apple Pies operates in a perfectly competitive market and the market price for a pie is $38, what profit (or loss) will this firm earn?
a profit of $200
a loss of $30 T
a loss of $200
a profit of $80 This is what I think the answeris
(1.) Johnny Rockabilly has just finished recording his latest CD. His record company
marketing department determines that the demand for the CD is as follows:
Number of CDs
Price
$24
10,000
22
20,000
20
30,000
18
40,000
6
50,000
3
60,000
The company can produce the CD with no fixed cost and a variable cost of $12 per
CD.
a. Find total revenues and marginal revenues for each of the quantities.
b. What quantity of CDs would maximize profit? What would the price be?
[TRUE / FALSE] Please explain
In the real-world, marginal cost curve is usually U-shaped.Therefore, in a perfectly competitive market, a firm can maximize profit at two different output levels in the short-run
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