ECN 221 TEST 3 QUESTIONS AND VERIFIED ANSWERS |
100% CORRECT | ALREADY GRADED A
In the long-run perfectly competitive equilibrium, a firm will Correct
Answers produce where MC equals price and earn zero economic profit
A firm in a perfectly competitive market happens to be earning positive
economic profit in the long-run equilibrium. Which of the following
would explain it? Correct Answers other firms are facing barriers to
entry
During the winter months in Wisconsin, perfectly competitive ice cream
shops remain open despite a decrease in demand. This is because
Correct Answers AVC<Price<ATC
In perfect competition, firms Correct Answers Are so numerous that
they take the market price as given
A firm in perfect competition is earning positive economic profit. It
must be that the firm Correct Answers Faces lower opportunity cost
A firm in the long-run perfect competition equilibrium produces 10
units at a price of $5.15 each. What is the average total cost (ATC)?
Correct Answers Exactly $5.15
A firm in the long-run perfect competition equilibrium produces 20
units at a price of $5.85 each. If the ATC is $5.15, then Correct Answers
Firms will enter the market and price will go down
, A firm in the long-run perfect competition equilibrium produces 30
units at a price of $6.85 each. If the Average Variable Cost is $6.15 and
Average Total Cost is $7.15, then Correct Answers The firm will shut
dow
A firm in perfect competition finds a method to reduce production cost.
How will this affect market supply and demand? Correct Answers No
change to market supply and market demand. (only effects individual
firms curves)
In perfect competition, if price is less than average total cost, then
Correct Answers Firms exit and supply decreases
Which point on the graph indicates the maximum quantity a firm can
produce to achieve the social optimum in long run Correct Answers
Where ATC=MC. (Eventually, the price will decrease to this amount.
Other amounts are not at the social optimum for either the firm or
consumers. Note that in perfect competition equilibrium, firms produce
at the social optimum where price=ATC=MC.)
Total Revenue = Correct Answers Price x Quantity
total cost = Correct Answers ATC x Q
Profit = Correct Answers total revenue - total cost/ (P-ATC)* Q
100% CORRECT | ALREADY GRADED A
In the long-run perfectly competitive equilibrium, a firm will Correct
Answers produce where MC equals price and earn zero economic profit
A firm in a perfectly competitive market happens to be earning positive
economic profit in the long-run equilibrium. Which of the following
would explain it? Correct Answers other firms are facing barriers to
entry
During the winter months in Wisconsin, perfectly competitive ice cream
shops remain open despite a decrease in demand. This is because
Correct Answers AVC<Price<ATC
In perfect competition, firms Correct Answers Are so numerous that
they take the market price as given
A firm in perfect competition is earning positive economic profit. It
must be that the firm Correct Answers Faces lower opportunity cost
A firm in the long-run perfect competition equilibrium produces 10
units at a price of $5.15 each. What is the average total cost (ATC)?
Correct Answers Exactly $5.15
A firm in the long-run perfect competition equilibrium produces 20
units at a price of $5.85 each. If the ATC is $5.15, then Correct Answers
Firms will enter the market and price will go down
, A firm in the long-run perfect competition equilibrium produces 30
units at a price of $6.85 each. If the Average Variable Cost is $6.15 and
Average Total Cost is $7.15, then Correct Answers The firm will shut
dow
A firm in perfect competition finds a method to reduce production cost.
How will this affect market supply and demand? Correct Answers No
change to market supply and market demand. (only effects individual
firms curves)
In perfect competition, if price is less than average total cost, then
Correct Answers Firms exit and supply decreases
Which point on the graph indicates the maximum quantity a firm can
produce to achieve the social optimum in long run Correct Answers
Where ATC=MC. (Eventually, the price will decrease to this amount.
Other amounts are not at the social optimum for either the firm or
consumers. Note that in perfect competition equilibrium, firms produce
at the social optimum where price=ATC=MC.)
Total Revenue = Correct Answers Price x Quantity
total cost = Correct Answers ATC x Q
Profit = Correct Answers total revenue - total cost/ (P-ATC)* Q
