Exam 14: Firms in Competitive Markets

When a certain competitive firm produces and sells 40 units of output, its total revenue is $740. If there is no change in price, then what is the amount of the firm's total revenue if it produces and sells 45 units of output?

Figure 14-10 In the figure below, panel (a) depicts the linear marginal cost of a firm in a competitive market, and panel (b) depicts the linear market supply curve for a market with a fixed number of identical firms. -Refer to Figure 14-10. If there are 700 identical firms in this market, what is the value of Q2?

In calculating accounting profit, accountants typically don't include

If identical firms that remain in a competitive market over the long run make zero economic profit, why do these firms choose to remain in the market?

If a firm in a competitive market doubles its number of units sold, total revenue for the firm will

When an individual firm in a competitive market increases its production, it is likely that the market price will fall.

In a competitive market,

Which of the following is not a characteristic of a perfectly competitive market?

In the long run, a competitive market with 1,000 identical firms will experience an equilibrium price equal to the minimum of each firm's average total cost.

Figure 14-4 Suppose a firm operating in a competitive market has the following cost curves: -Refer to Figure 14-4. At which price range will the firm continue to operate in the short run but earn negative profits?

Consider a firm operating in a competitive market. The firm is producing 40 units of output, has an average total cost of production equal to $6, and is earning $240 economic profit in the short run. What is the current market price?

When a competitive firm doubles the quantity of output it sells, its

The manager of a firm operating in a competitive market can ignore sunk costs when making business decisions.

Whenever a perfectly competitive firm chooses to change its level of output, its marginal revenue

Profit-maximizing firms in a competitive market produce an output level where

Table 14-5 The table represents a demand curve faced by a firm in a competitive market. -Refer to Table 14-5. For this firm, the marginal revenue of the 12th unit is

A competitive firm would benefit from charging a price below the market price because the firm would achieve (i) Higher average revenue.(ii) Higher profits. (iii) Lower total costs.

Which of the following represents the firm's long-run condition for exiting a market?

A profit-maximizing firm in a competitive market will earn zero accounting profits in the long run.

Figure 14-2 Suppose a firm operating in a competitive market has the following cost curves: -Refer to Figure 14-2. If the market price is Pa, in the short run the firm will earn