Exam 14: Firms in Competitive Markets.

Table 14-11 Suppose that a firm in a competitive market faces the following prices and costs: -Refer to Table 14-11.If the firm is producing 2 units of output,it should

A firm operating in a perfectly competitive industry will continue to operate in the short run but earn losses if the market price is less than that firm's average total cost but greater than the firm's average variable cost.

Raiman's Shoe Repair produces custom-made shoes.When Mr.Raiman produces 12 pairs per week,the marginal cost of the 12th pair is $84,and the marginal revenue of the 12th pair is $70.What would you advise Mr.Raiman to do?

Which of the following statements is correct regarding a firm's decision-making?

In a long-run equilibrium where firms have identical costs,it is possible that some firms in a competitive market are making a positive economic profit.

Table 14-6 The following table presents cost and revenue information for a firm operating in a competitive industry. -Refer to Table 14-6.What is the total revenue from selling 7 units?

Table 14-2 The table represents a demand curve faced by a firm in a competitive market. -Refer to Table 14-2.A firm operating in a competitive market maximizes total revenue by producing

For a firm in a perfectly competitive market,the price of the good is always

If a firm notices that its average revenue equals the current market price,that firm must be participating in a competitive market.

Scenario 14-3 Suppose a certain competitive firm is producing Q=500 units of output. The marginal cost of the 500th unit is $17, and the average total cost of producing 500 units is $12. The firm sells its output for $20. -Refer to Scenario 14-3.If the marginal cost of producing the 501st unit would be $19,producing and selling the 501st unit would

Which of the following industries is least likely to exhibit the characteristic of free entry?

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

The short-run market supply curve in a perfectly competitive industry

Laura is a gourmet chef who runs a small catering business in a competitive industry.Laura specializes in making wedding cakes.Laura sells 20 wedding cakes per month.Her monthly total revenue is $5,000.The marginal cost of making a wedding cake is $200.In order to maximize profits,Laura should

When a restaurant stays open for lunch service even though few customers patronize the restaurant for lunch,which of the following principles is (are)best demonstrated? (i)Fixed costs are sunk in the short run. (ii)In the short run,only fixed costs are important to the decision to stay open for lunch. (iii)If revenue exceeds variable cost,the restaurant owner is making a smart decision to remain open for lunch.

A market might have an upward-sloping long-run supply curve if

When a profit-maximizing firm in a competitive market experiences rising prices,it will respond with an increase in production.

Figure 14-9 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 14-9.If there are 200 identical firms in this market,what level of output will be supplied to the market when price is $1.00?

Scenario 14-1 Assume a certain firm in a competitive market is producing Q = 1,000 units of output. At Q = 1,000, the firm's marginal cost equals $15 and its average total cost equals $11. The firm sells its output for $12 per unit. -Refer to Scenario 14-1.To maximize its profit,the firm should

Scenario 14-2 Assume a certain firm is producing Q = 1,000 units of output. At Q = 1,000, the firm's marginal cost equals $20 and its average total cost equals $25. The firm sells its output for $30 per unit. -Refer to Scenario 14-2.At Q = 999,the firm's profits equal