Exam 14: Firms in Competitive Markets.

Figure 14-1 Suppose that a firm in a competitive market has the following cost curves: -Refer to Figure 14-1.The firm will earn a positive economic profit in the short run if the market price is

Which of these curves is the competitive firm's short-run supply curve?

In a competitive market,the actions of any single buyer or seller will

Profit maximizing firms in competitive industries with free entry and exit face a price equal to the lowest possible

Table 14-11 Suppose that a firm in a competitive market faces the following prices and costs: -Refer to Table 14-11.In order to maximize profits,the firm should stop producing after it makes the

If some resources used in the production of a good are only available in limited quantities,then the long run market supply curve will be perfectly elastic.

The marginal firm in a competitive market will earn zero economic profit in the long run.

For any given price,a firm in a competitive market will maximize profit by selecting the level of output at which price intersects the

Table 14-14 The following table presents cost and revenue information for Bob's bakery production and sales. -Refer to Table 14-14.What is Bob's total fixed cost?

Figure 14-13 Suppose a firm in a competitive industry has the following cost curves: -Refer to Figure 14-13.If the price is P1 in the short run,what will happen in the long run?

Suppose a competitive market is comprised of firms that face identical cost curves.The firms experience an increase in demand that results in positive profits for the firms.Which of the following events are then most likely to occur? (i)New firms will enter the market. (ii)In the short run,price will rise; in the long run,price will rise further. (iii)In the long run,all firms will be producing at their efficient scale.

Table 14-2 The table represents a demand curve faced by a firm in a competitive market. -Refer to Table 14-2.For a firm operating in a competitive market,the marginal revenue from selling the 3rd unit is

Table 14-14 The following table presents cost and revenue information for Bob's bakery production and sales. -Refer to Table 14-14.Suppose that due to a decrease in the market demand for bread the market price of bread drops to $2.75.At this new price,if Bob produces and sells the profit-maximizing quantity,how much profit will he earn?

Mrs.Smith operates a business in a competitive market.The current market price is $7.50.At her profit-maximizing level of production,the average variable cost is $8.00,and the average total cost is $8.25.Mrs.Smith should

A competitive firm has been selling its output for $20 per unit and has been maximizing its profit,which is positive.Then,the price falls to $18,and the firm makes whatever adjustments are necessary to maximize its profit at the now-lower price.Once the firm has adjusted,its

A firm operating in a competitive market will stay in business in the short run so long as the market price exceeds the firm's average total cost; otherwise,the firm will shut down.

Suppose a firm in a competitive market produces and sells 150 units of output and earns $1,800 in total revenue from the sales.If the firm increases its output to 200 units,the average revenue of the 200th unit will be

Figure 14-3 Suppose a firm operating in a competitive market has the following cost curves: -Refer to Figure 14-3.If the market price is $10,what is the firm's short-run economic profit?

Because there are many buyers and sellers in a perfectly competitive market,no one seller can influence the market price.

A corporation has been steadily losing money on one of its product lines,plastic flamingo lawn ornaments.The firm produces plastic flamingos in a factory that cost $20 million to build 10 years ago.The firm is now considering an offer to buy that factory for $15 million.Which of the following statements about the decision to sell or not to sell is correct?