Suppose a firm in a competitive market reduces its output by 20 percent. As a result,...
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Ans) the correct option is b) remain unchanged
In a competitive market price is constant equal to marginal cost.
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Suppose a firm in a competitive market reduces its output by 20 percent. As a result,...
Consider the following total cost schedule for a perfectly competitive firm producing ball-point pens. Suppose the...
Consider the following total cost schedule for a perfectly competitive firm producing ball-point pens. Suppose the prevailing market price for this firm's product is $0.14 and the firm is currently producing 20 units of output. This competitive firm wishing to maximize its profit would Output per period TVC (S) TFC (S) 0 0 10 25 20 30 6 5 40 10 5 50 15 3. Increase output because marginal revenue is greater than marginal cost b. produce zero output because...
24. In a competitive industry the market price of output is $24. A firm is producing...
24. In a competitive industry the market price of output is $24. A firm is producing that level of output at which average total cost is $30, marginal cost is $25, and average fixed cost is $5. In order to maximize profit (or minimize losses), the firm should a. increase output b. decrease output but keep producing. c. leave output unchanged. d. shut down 25. In long-run competitive equilibrium, a. economic profit is zero. b. P LMC. c. P LAC....
Suppose your firm operates in a perfectly competitive market and decides to double its output. How...
Suppose your firm operates in a perfectly competitive market and decides to double its output. How does this affect the firm's marginal profit? Select one: a. Marginal revenue and marginal cost increase b. Marginal revenue increases but marginal cost remains the same C. Marginal cost may change but marginal revenue remains the same d. Marginal revenue and marginal cost decrease
Suppose your firm operates in a perfectly competitive market and decides to double its output. How...
Suppose your firm operates in a perfectly competitive market and decides to double its output. How does this affect the firm's marginal profit? Please provide the answer& proper explanation in word format not in hand writing format A) Marginal revenue and marginal cost increase B) Marginal revenue increases but marginal cost remains the same C) Marginal cost may change but marginal revenue remains the same D) Marginal revenue and marginal cost decrease
Suppose that a firm in a perfectly competitive market faces the following prices and costs: Price...
Suppose that a firm in a perfectly competitive market faces the following prices and costs: Price Quantity Total Cost $6 p $$4 $6 1 $6 $6 2 $9 $6 $13 $6 $18 $6 IS $24 $6 16 $3 Marginal revenue equals marginal cost when the firm produces 5 units. 4 units. 2 units. 3 units. Which of the following is correct? In the short run, FC can decrease with less output. In the short run, FC can decrease with more...
If a competitive firm is operating in short run equilibrium and then its fixed costs fall by 40 percent, it should:...
If a competitive firm is operating in short run equilibrium and then its fixed costs fall by 40 percent, it should: use more labor and less capital in current production. not change its output. increase its output. U decrease its output.
69. Suppose a monopolistically competitive market has 10 firms. The largest firm has a 90 percent...
69. Suppose a monopolistically competitive market has 10 firms. The largest firm has a 90 percent share of the market and the other nine firms each have 1 percent of the market. The Herfindahl-Hirschman Index for this industry is ________. a. 8,109 b. 8,100 c. 99 d. 909 70. An industry is deemed concentrated when ________. a. each firm in that industry has a small market share b. all the firms in that industry charge a price lower than the...
If a perfectly competitive firm is producing 150 units of output at a price of P=$20,...
If a perfectly competitive firm is producing 150 units of output at a price of P=$20, where the MC of the 150th unit of output is MC=$20, the ATC of the 150th unit is ATC=$10, and the AVC of the 150th unit is AVC=$8, then which of the following statements is not correct? a. The firm should shut down when the price is less or equal to $8. b. The firm is producing at the profit maximizing level of output....
5. Each firm in a competitive market has a cost function TC() 102q+ and there are...
5. Each firm in a competitive market has a cost function TC() 102q+ and there are n = 20 firms in the short run. The short-run equilibrium price is p-5. What happens in the long-run equilibrium as compared to the short-run equilibrium (a) Does the equilibrium price increase or decrease? Explain (b) Does the number of firms increase or decrease? Explain (c) Does the output of a single firm increase or decrease? Explain (d) Does the total market output increase...
A profit-maximizing firm in a competitive market is currently producing 100 units of output
A profit-maximizing firm in a competitive market is currently producing 100 units of output. It has average revenue so $10, average total cost of $8 and fixed cost of $200. a. what is the profit?b. what is the marginal cost?c. what is its average variable cost?d. is the efficent scale of the firm more than, less than, or equal to 100 units?
Consider the following total cost schedule for a perfectly competitive firm producing ball-point pens. Suppose the prevailing market price for this firm's product is $0.14 and the firm is currently producing 20 units of output. This competitive firm wishing to maximize its profit would Output per period TVC (S) TFC (S) 0 0 10 25 20 30 6 5 40 10 5 50 15 3. Increase output because marginal revenue is greater than marginal cost b. produce zero output because...
24. In a competitive industry the market price of output is $24. A firm is producing that level of output at which average total cost is $30, marginal cost is $25, and average fixed cost is $5. In order to maximize profit (or minimize losses), the firm should a. increase output b. decrease output but keep producing. c. leave output unchanged. d. shut down 25. In long-run competitive equilibrium, a. economic profit is zero. b. P LMC. c. P LAC....
Suppose your firm operates in a perfectly competitive market and decides to double its output. How does this affect the firm's marginal profit? Select one: a. Marginal revenue and marginal cost increase b. Marginal revenue increases but marginal cost remains the same C. Marginal cost may change but marginal revenue remains the same d. Marginal revenue and marginal cost decrease
Suppose that a firm in a perfectly competitive market faces the following prices and costs: Price Quantity Total Cost $6 p $$4 $6 1 $6 $6 2 $9 $6 $13 $6 $18 $6 IS $24 $6 16 $3 Marginal revenue equals marginal cost when the firm produces 5 units. 4 units. 2 units. 3 units. Which of the following is correct? In the short run, FC can decrease with less output. In the short run, FC can decrease with more...
If a competitive firm is operating in short run equilibrium and then its fixed costs fall by 40 percent, it should: use more labor and less capital in current production. not change its output. increase its output. U decrease its output.
5. Each firm in a competitive market has a cost function TC() 102q+ and there are n = 20 firms in the short run. The short-run equilibrium price is p-5. What happens in the long-run equilibrium as compared to the short-run equilibrium (a) Does the equilibrium price increase or decrease? Explain (b) Does the number of firms increase or decrease? Explain (c) Does the output of a single firm increase or decrease? Explain (d) Does the total market output increase...
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