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.The marginal revenue from producing the 3rd unit equals (i) $5. (ii) the price. (iii) the marginal cost.

A miniature golf course is a good example of where fixed costs become relevant to the decision of when to open and when to close for the season.

For an individual firm operating in a competitive market,marginal revenue equals

Figure 14-13 Suppose a firm in a competitive industry has the following cost curves: -Refer to Figure 14-13.If the price is P3 in the short run,what will happen in the long run?

If occupational safety laws were changed so that firms no longer had to take expensive steps to meet regulatory requirements,we would expect that

Suppose a firm in a competitive market produces and sells 8 units of output and has a marginal revenue of $8.00.What would be the firm's total revenue if it instead produced and sold 4 units of output?

If Cathy's Coffee Emporium sells its product in a competitive market,then

Table 14-13 Diana's Dress Emporium -Refer to Table 14-13.What is the marginal cost of the 1st unit?

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

In the long-run equilibrium of a market with free entry and exit,if all firms have the same cost structure,then

In competitive markets,firms that raise their prices are typically rewarded with larger profits.

Marcia is a fashion designer who runs a small clothing business in a competitive industry.Marcia specializes in making designer dresses.Marcia sells 10 dresses per month.Her monthly total revenue is $5,000.The marginal cost of making a dress is $400.In order to maximize profits,Marcia should

For a firm in a competitive market,an increase in the quantity produced by the firm will result in

A firm will shut down in the short run if revenue is not sufficient to cover its variable costs of production.

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 = 1,000,the firm's profits equal

Scenario 14-4 As part of an estate settlement Mary received $1 million. She decided to use the money to purchase a small business in Anywhere, USA. Her business operates in a perfectly competitive industry. If Mary would have invested the $1 million in a risk-free bond fund she could have earned $100,000 each year. She also quit her job with Lucky.Com Inc. to devote all of her time to her new business. Her salary at Lucky.Com Inc. was $75,000 per year. -Refer to Scenario 14-4.What are Mary's opportunity costs of operating her new business?

Figure 14-14 -Refer to Figure 14-14.Assume that the market starts in equilibrium at point A in panel (b)and that panel (a)illustrates the cost curves facing individual firms.Suppose that demand increases from D0 to D1.Which of the following statements is correct?

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?

A seller in a competitive market can

In the transition from the short run to the long run,the number of firms in a competitive industry is