In the short run, a perfectly competitive firm should continue to produce as long as it can cover its variable costs. Which of the following conditions describes this rule? OP> MR OP> AFC O ATC > AVC OP> AVC
Q: Wheat is produced in a perfectly competitive market. Suppose the market demand for wheat increases.…
A: A perfectly competitive firm is a price taker, which means it takes the price set by the market…
Q: Perfectly competitive firms maximize profits by choosing the profit-maximizing output level. They…
A: A perfectly competitive market is characterized by a large number of buyers and sellers in the…
Q: If a competitive firm finds that it maximizes short-run profits by shutting down, which of the…
A: Shut down point: The shutdown point exits at that point where the price is equal to the minimum…
Q: normal profit
A: There are different market structures like: ‘Perfect Competition’, ‘Monopoly’, ‘Monopolistic…
Q: n the long run, perfectly competitive firms are at equilibrium when: (LMC = Long-Run Marginal Cost;…
A: Under a perfectly competitive market structure, the firms are price takers who accept the market…
Q: The short-run supply curve of a firm operating in a perfect competition market is equal to the…
A: A shutdown arises when price or average revenue (AR) falls below average variable cost (AVC) at the…
Q: If it is possible for a perfectly competitive firm to do better financially by producing rather than…
A: A perfectly competitive firm is a price taker and can sell any quantity of the commodity at the…
Q: In perfectly competitive markets, _____________________ and marginal revenue are identical.
A: A perfectly competitive market is a market in which there are many firms and many buyers. The…
Q: Would a perfectly competitive firm produce if price were less than the minimum level of average…
A: No, a perfectly competitive firm would not produce if price were less than the minimum level of…
Q: Company ABC produces goods X which are sold in a perfectly competitive market. The selling price of…
A: A perfectly competitive firm is in equilibrium at the point where : The marginal revenue (MR)…
Q: Would independent trucking fit the characteristics of a perfectly competitive industry? and why?
A: A perfectly competitive market is where there are many numbers of buyers and sellers, with…
Q: A perfectly competitive firm will maximize its profit when marginal revenue is greater than marginal…
A: Marginal Revenue is the cash a firm makes for each extra deal. As such, it decides how much a firm…
Q: For a perfectly competitive producer, the firm's short-run supply curve is: MC ATC AVC Q
A: A firm in perfectly competitive market is a price taker as there are many sellers selling identical…
Q: A perfectly competitive firm, with MC=q operates in a market character,zed by the following market…
A: Demand: Q=20000-100P Supply: Q=100P
Q: A profit-maximizing business incurs an economic loss of $$30,000 per year. Its fixed cost is $45,000…
A: Short run business decision: It is given that, it is a profit-optimizing firm that incurs an…
Q: Since a perfectly competitive firm can sell as much as it wishes at the market price, why can the…
A: A perfect competition(PC) market is one with many buyers and sellers producing identical products.…
Q: Which of the following is NOT necessarily true about the long-run equilibrium of a perfectly…
A: A perfectly competitive firm is a price taker and choses the level of output where marginal cost…
Q: Which of the following is true for a perfectly competitive industry?
A: option 3 is rhe correct answer The firm in industry produce standardized products It's dentical…
Q: The second-order condition for a firm maximizing its profits operating in a perfectly competitive…
A: Profit is maximized at the point where the marginal cost is equal to marginal revenue.
Q: At prices that motivate the firm to produce at all, the short-run supply curve for the perfect…
A: A firm is said to be operating in a short run if the marginal cost is not equal to its total cost.…
Q: Q4) A perfectly competitive firm has the following total cost function: 05 Total output Total Cost…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: In a perfectly competitive industry the market price is P12. A firm is currently producing 50 units…
A: Perfectly competitive market: It is a market structure in which there operates a large number of…
Q: A perfectly competitive firm is producing at the point where its marginal cost equals the price of…
A: We are going to use profit maximisation structure of a perfectly competitive firm
Q: Suppose a perfectly competitive firm’s demand curve is below its average total cost curve. Explain…
A: In a perfectly competitive market there are large number of firms producing similar and identical…
Q: Time remaining: 00 :07 :05 Economics Assume that the market for Wheat is perfectly competitive in a…
A: Given the ATC = ATC(Q) = 1000/Q + 200 − 10Q + Q^2 / 3 MC(Q) = 200 − 20Q + Q^2 AVC(Q) = 200 − 10Q +…
Q: The market for fertilizer is perfectly competitive. Firms in the market are producing output but are…
A: A perfectly competitive market is characterized by a large number of buyers and sellers. The market…
Q: In the long-run equilibrium of a competitive market with identical firms, what are the relationships…
A: please find the answer below.
Q: Suppose that a firm sells its output in a perfectly competitive output market. If the price at which…
A: Perfect competition refers to the situation where there are large number of prouder and consumers…
Q: Suppose a perfectly competitive industry has 300 identical firms in the short run. Each firm faces a…
A: A perfectly competitive firm produces homogeneous goods which makes them price takers
Q: Perfectly competitive firms will react to profits in the long run by _______ production.
A: The market is a location where the transaction of services and commodities takes place.
Q: In a perfectly competitive market, please compare the short run and long run prices in an increasing…
A: Perfect competition refers to the market structure where there are a large of number of buyers and…
Q: the profit maximization condition for a perfectly competitive firm in the short-run- is
A: Perfect competition is the market form that involves a large number of buyers and sellers in the…
Q: Consider the market for ice cream. Suppose that this market is perfectly competitive. The cost…
A: Answer: A perfectly competitive firm maximizes its profit where the average total cost (ATC) is…
Q: A firm sells its product in a perfectly competitive market where other firms charge a price of $90…
A: We are given , TC = 50 + 10q + 2q2 Since the firm sells it's product in a perfectly…
Q: A firm in a perfectly competitive industry knows the following about its costs and revenue. The firm…
A: In perfectly competitive market price is constant so it is equal to marginal revenue. At profit…
Q: Consider the perfectly competitive market for tofu. Tofu production requires special inspections…
A: Introduction: Pure or perfect competition is a theoretical market structure in which the following…
Q: Lasguns are produced by identical firms in a perfectly competitive market. Each firm's Total Cost…
A: Long-Term Market Equilibrium In a completely competitive market, the long-run equilibrium occurs…
Q: Does a competitive firm’s price equal its marginal cost in the short run?
A: A competitive firm is one that produces and sells output in the market with many sellers who offers…
Q: Consider a profit-maximizing firm in a competitive industry. For each of the following situations,…
A: In a competitive industry, the profit of a firm gets maximized at the point where marginal revenue…
Q: What is the formula for profit maximization by firm ? Why does this result in the marginal cost…
A: The profit for a firm can be calculated by subtracting the total cost (TC) from the total revenue…
Q: Japayuki Noodle Restaurant, a restaurant that is under a perfectly competitive market, is selling…
A: Here, it is given that output sold: 75 bowls of super Chasu Selling price per-unit: $20.00 MC, ATC,…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- 1) The cost curves for a firm in a perfectly competitive industry are given below. Complete the table. If the firm operates in a perfectly competitive market, and the market price is $25 per unit, what Quantity should this firm produce at? TFC TC TVC AVC ATC MC TR S100 S100 1 S100 S130 2 S100 S150 S100 S160 S100 S172 5 S100 S185 6 S100 $210 S100 $240 S100 $280 S100 $330 10 S100 $390 Table 9.1Does a competitive firm’s price equal the minimumof its average total cost in the short run, in the longrun, or both? Explain.A perfectly competitive firm faces the short-run cost schedule shown in Table (a)Calculate average total cost (ATC=TC/Q), marginal cost (MC=ATC/AQ) and marginal revenue (MR-ATR/AQ) for each level of output. The price per unit of output is £16 b) Plot ATC, MC and MR on a graph and mark the profit-maximising output. At what output is profit maximised? c) How much profit/loss is made at the optimum level of output? Assume market price declines to £9 per unit. If the firm's average variable cost is £9.5, should the firm shut down in the short run? In the long run? Explain. If the firm is typical of other firms, what price will it charge in the long run? Explain.
- Suppose a perfectly competitive firm is operating in short run. The information of MR, Q, ATC and AVC are 25 taka, 60 unit, 35taka and 15taka respectively. Calculate firm’s profit/loss and total fixed cost. From these calculations and based on all the given information, can you conclude about the firm’s decision in short run? Explain your reasoning with the help of a suitable diagram. Show all the relevant information in your diagram.[Q=profit maximizing output and MR=marginal revenue]. Don,t copy from anywhere. Answer must be correct. Do step by stepConsider a profit-maximizing firm in a competitive industry. For each of the following situations, indicate whether the firm should shut down production or produce where MR = MC. a. P < minimum AVC. b. P > minimum ATC. c. Minimum AVC < P < minimum ATC.Mo owns a Coffee truck which operates in a perfectly competitive industry. He faces the following cost schedule (notice that his coffee maker makes ten cups at a time, and that he has a daily fixed cost of operating the truck). If the market price of a cup of coffee is $2.50, what Q would a profit-maximizer choose to produce? (Hint: compute MR and MC at each Q) Q TC 0 $30 10 $50 20 $63 30 $73 40 $78 50 $95 60 $120
- Mo owns a Coffee truck which operates in a perfectly competitive industry. He faces the following cost schedule (notice that his coffee maker makes ten cups at a time, and that he has a daily fixed cost of operating the truck). If the market price of a cup of coffee is $2.50, what Q would a profit-maximizer choose to produce? (Hint: compute MR and MC at each Q) Q TC 0 $30 10 $50 20 $63 30 $73 40 $78 50 $95 60 $120 Select one: a. 50 b. 40 c. 60 d. 30 e. 20Required information The following figure shows the costs for a perfectly competitive producer. AVC, ATC, MC $45 40 35 30 25 201 15 10 5 0 C 10 20 30 40 50 60 70 80 90 100 ATC AVC Output per period Refer to the above figure to answer this question. If the price of the product is $35, what is the profit-maximizing output?A firm in a perfectly competitive industry knows the following about its costs and revenue. The firm would like to maximize profit and has hired a consultant for advice. Price Q of Output Total Revenue Total Cost Total Fixed Cost 10 500 TR? 9,400 TFC ? Total Variable Cost Average Total Cost Average Variable Cost MC 6,500 is at minimum level AVC? MC? Total Revenue Number Total Fixed Cost Number Average Variable Cost Number Marginal Cost Number What is the value of the profit or loss (-) at the current output ( include the - sign if it's a loss) Number Consultant's Advice: As a consultant, what advice would you give to this firm:(Choose ONE answer from the following) Number 1. Firm should do nothing; it is already profit maximizing/loss minimizing 2. Firm should reduce quantity of output 3. Firm should increase quantity of output 4. Firm should shutdown operations 5. The given number set is inconsistent
- In the short run, a strawberry farm operating in a perfectly competitive market would produce strawberries at a profit if... Group of answer choices They sell each package of strawberries for $5, and the average variable cost is $4.75. Their fixed costs are less than their variable costs. Set the price for each package of strawberries above the prevailing equilibrium price. They sell each package of strawberries for $5, and the average cost is for each package is $5The graph below shows the marginal cost (MC), average variable cost (AVC), and average total cost (ATC) curves for a firm in a competitive market. These curves imply a short-run supply curve that has two distinct parts. One part, not shown, lies along the vertical axis (quantity-0); this represents a condition of production shutdown. Where is the other part? Use the straight-line tool to drawit. To refer to the graphing tutorial for this question type, please click here Price and cost 18 15 14 13 12 10 19/21 SUBMIT ANSWER 13 OF 21 QUESTIONS C OMPLETED 28 MacBook Pro 금□ F7 F8 F9 F1o F2 F3 F5A perfectly competitive frim has the total cost curve is given by:TC = 270+13q+0.4q2. What is the firm fixed cost? A. 13q+0.4q2 B. 270 C. 270+13q D. 27