Exam 12: Perfect Competition

-The above table gives Amy's total cost schedule for producing holiday wreaths. Amy is a perfect competitor and can sell each wreath for $9. a) Complete the table by calculating Amy's total revenue and her profit or loss schedule. b) When Amy is producing 4 wreaths, what is her total cost? What is her total revenue? What is her economic profit or economic loss? c) What number of wreaths maximizes Amy's profit?

-The above figure illustrates a firm's total revenue and total cost curves. Which one of the following statements is FALSE?

-The table above gives the total revenue and total cost for a perfectly competitive firm producing chocolate chip cookies. If the firm increases its output from 2 pounds of cookies to 3 pounds, the marginal cost is ________ per pound of cookies.

Economic profit is ________.

-The above table shows the per day total cost for Kiley's Baseball Glove Company. Each glove is priced at $50 and Kiley's Baseball Glove Company is a perfectly competitive firm. Between which two amounts of output does Kiley's Baseball Glove Company earn an economic profit?

-In the above figure showing a perfectly competitive firm's total revenue line, the firm's marginal revenue

For a perfectly competitive firm, in the long-run equilibrium,

-In the above table, the average fixed cost at 4 units of output is

In perfect competition, the elasticity of demand for the product of a single firm is

A firm's shutdown point is the output and price at which the firm just covers its

Because of a decrease in the wage rate it must pay, a perfectly competitive firm's marginal costs decrease but its demand curve stays the same. As a result, the firm

The difference between a perfectly competitive firm's total revenue and its total cost is

What role does economic profit play in a competitive market?

If the market price of a perfectly competitive firm's product is below its average variable cost, then the firm's

In the short run, a perfectly competitive firm can

Price taking behavior exists in

The U-pick berry market is perfectly competitive. Suppose that all U-pick blueberry farms have the same cost curves and all are making an economic profit. What happens as time passes? What is the long-run equilibrium outcome?

Suppose firms in a perfectly competitive market are incurring an economic loss. Over time,

Pumpkin growing is a perfectly competitive industry. Suppose that pumpkin growers are all incurring an economic loss. What happens as time passes? What is the long-run equilibrium outcome?

Paul runs a shop that sells printers. Paul is a perfect competitor and can sell each printer for a price of $300. The marginal cost of selling one printer a day is $200; the marginal cost of selling a second printer is $250; and the marginal cost of selling a third printer is $350. To maximize his profit, Paul should sell