Exam 12: Perfect Competition and the Supply Curve

Use the following to answer question: -(Figure: Cost Curves for Corn Producers)Use Figure: Cost Curves for Corn Producers.The market for corn is perfectly competitive.If the price of a bushel of corn is $4,in the short run the farmer will produce _____ bushels of corn and earn an economic _____ equal to _____.

People in the eastern part of Beirut are prevented by border guards from traveling to the western part of Beirut to shop for or sell food.This situation violates the perfect competition assumption of:

Use the following to answer question: -(Table: Variable Costs for Lawns)Use Table: Variable Costs for Lawns.During the summer,Alex runs a lawn-mowing service,and lawn-mowing is a perfectly competitive industry.Assume that costs are constant in each interval;so,for example,the marginal cost of mowing each of the lawns from 1 through 10 is $10.Also assume that he can only mow the quantities of lawn given in the table (and not numbers in between).His only fixed cost is $1,000 for the mower.His variable costs include fuel,his time,and mower parts.If the price for mowing a lawn is $70,how much is Alex's profit at the profit-maximizing output?

Use the following to answer question: -(Table: Lilly's Apple Orchard)Use Table: Lilly's Apple Orchard.Lilly is the price-taking owner of an apple orchard.Her orchard has fixed costs of $30.If the price of a bushel of apples is $25,how many bushels will Lilly produce to maximize profit?

Use the following to answer question: -(Table: Variable Costs for Lots)Use Table: Variable Costs for Lots.During the winter,Alexa runs a snow-clearing service in a perfectly competitive industry.Assume that costs are constant in each interval;so,for example,the marginal cost of clearing each of the lots from 1 through 10 is $20.Also assume that she can only plow the quantities of the lots given in the table (and not numbers in between).Her only fixed cost is $1,000 for a snowplow.Her variable costs include fuel,her time,and hot coffee.If the price to clear a lot is $30,what is Alexa's profit per unit at the optimal output?

Use the following to answer question: -(Figure: The Profit-Maximizing Firm in the Short Run)Use Figure: The Profit-Maximizing Firm in the Short Run.Which curve is the AVC curve?

Use the following to answer question: -(Table: Total Cost and Output)Use Table: Total Cost and Output,which describes Sergei's total costs for his perfectly competitive all-natural ice cream firm.If the market price of a tub of ice cream is $67.50,how much is Sergei's total revenue at the profit-maximizing output?

A perfectly competitive firm's short-run supply curve is its marginal cost curve above its intersection with the average variable cost curve.

Use the following to answer question: -(Figure: The Profit-Maximizing Firm in the Short Run)Use Figure: The Profit-Maximizing Firm in the Short Run.The MC curve is represented by:

Consider a perfectly competitive firm in the short run.Assume that the firm produces the profit-maximizing output and earns economic profits.Which statement is definitely FALSE?

Marginal revenue is a firm's:

Suppose that the market for haircuts in a community is a perfectly competitive constant-cost industry and that the market is initially in long-run equilibrium.Subsequently,an increase in population increases the demand for haircuts.In the long run,firms will _____ the market,driving the price of haircuts _____ and the profits of individual firms _____.

A perfectly competitive firm is definitely earning an economic profit when:

Use the following to answer question: -(Table: Total Cost for a Perfectly Competitive Firm)Use Table: Total Cost for a Perfectly Competitive Firm.If the market price is $5.50,the profit-maximizing quantity of output is _____ units. =

Use the following to answer question: -(Table: Variable Costs for Lots)Use Table: Variable Costs for Lots.During the winter,Alexa runs a snow-clearing service in a perfectly competitive industry.Assume that costs are constant in each interval;so,for example,the marginal cost of clearing each of the lots from 1 through 10 is $20.Also assume that she can only plow the quantities of the lots given in the table (and not numbers in between).Her only fixed cost is $1,000 for a snowplow.Her variable costs include fuel,her time,and hot coffee.At what price does Alexa' s short-run supply curve start?

Use the following to answer question: -(Figure: Game-Day Shirts)Use Figure: Game-Day Shirts.Rick is one of 10 vendors who sell game-day T-shirts at football games in a perfectly competitive market.His costs are identical to the costs of the other 9 vendors.If the price of a shirt is $14,in the long run:

Firms will make a profit in the long run or short run if the price is:

Use the following to answer question: -(Figure: A Perfectly Competitive Firm in the Short Run)Use Figure: A Perfectly Competitive Firm in the Short Run.If the market price is G,the firm's total economic profit at its most profitable level of output is:

Cindy's Nails operates in the perfectly competitive pedicure industry.The city is considering requiring nail salons to be certified by a health inspector.The certification will cost $1,000 annually and is thus a fixed cost.The certification will affect Cindy's decision to operate in the long run but will not affect the number of pedicures she chooses to perform in the short run.

If a perfectly competitive gardening shop sells 30 evergreen bushes at $10 per bush,its marginal revenue is: