Exam 23: Competitive Markets

One World View article titled "U.S.Catfish Industry Bleeding Finally Stops" describes the loss of supply in the catfish market.Which of the following is not true for a perfectly competitive industry in the long run?

Because a perfectly competitive firm has no market power,its marginal cost curve is flat (i.e. ,horizontal).

If a new sushi restaurant opens,then

The price signal the consumer gets in a competitive market

Refer to Figure 23.1 for a perfectly competitive firm.This firm should shut down in the short run if the market price is below

If economic profits are earned in a competitive market,then over time

In a perfectly competitive market,firms will earn zero economic profits in the long run.

Which of the following is a determinant of market supply but not the supply curve of an individual firm?

When entrepreneurs decide to build a plant,they are making a production decision.

The decision by firms to enter a market shifts the market supply curve to the right.