Table 9-1 $\begin{array}{|c|c|c|} \hline \text { Quantity } & \begin{array}{c} \text { Total Cost } \\ \text { (dollars) } \end{array} & \begin{array}{c} \text { Variable Cost } \\ \text { (dollars) } \end{array} \\ \hline 0 & \$ 1,000 & \$ 0 \\ \hline 100 & 1,360 & 360 \\ \hline 200 & 1,560 & 560 \\ \hline 300 & 1,960 & 960 \\ \hline 400 & 2,760 & 1,760 \\ \hline 500 & 4,000 & 3,000 \\ \hline 600 & 5,800 & 4,800 \\ \hline \end{array}$ Table 9-1 shows the short-run cost data of a perfectly competitive firm that produces plastic camera cases. Assume that output can only be increased in batches of 100 units. -Refer to Table 9-1.What is the fixed cost of production?

A) $0 B) $500 C) $1,000 D) It cannot be determined. A) $0 B) $500 C) $1,000 D) It cannot be determined.

Table 9-1 $\begin{array}{|c|c|c|} \hline \text { Quantity } & \begin{array}{c} \text { Total Cost } \\ \text { (dollars) } \end{array} & \begin{array}{c} \text { Variable Cost } \\ \text { (dollars) } \end{array} \\ \hline 0 & \$ 1,000 & \$ 0 \\ \hline 100 & 1,360 & 360 \\ \hline 200 & 1,560 & 560 \\ \hline 300 & 1,960 & 960 \\ \hline 400 & 2,760 & 1,760 \\ \hline 500 & 4,000 & 3,000 \\ \hline 600 & 5,800 & 4,800 \\ \hline \end{array}$ Table 9-1 shows the short-run cost data of a perfectly competitive firm that produces plastic camera cases. Assume that output can only be increased in batches of 100 units. -Refer to Table 9-1.If the market price of each camera case is $8 and the firm maximizes profit,what is the amount of the firm's profit or loss?

A) $0 (it breaks even) B) loss of $1,000 C) profit of $440 D) loss of $440 A) $0 (it breaks even) B) loss of $1,000 C) profit of $440 D) loss of $440

Table 9-2 $\begin{array}{|c|c|c|c|c|} \hline\begin{array}{c} \text { Apples } \\ \text { (pounds) } \end{array} & \begin{array}{c} \text { MarketPrice } \\ \text { per Pound } \end{array} & \begin{array}{c} \text { Total } \\ \text { Revenue } \\ (\text { TR) } \end{array} & \begin{array}{c} \text { Average } \\ \text { Revenue } \\ \text { (AR) } \end{array} & \begin{array}{c} \text { Marginal } \\ \text { Revenue } \\ \text { (MIR) } \end{array} \\ \hline 0 & \$ 3 & \$ 0 & \cdots& \cdots \\ \hline 100 & & & & \\ \hline 150 & & & & \\ \hline 200 & & & & \\ \hline 250 & & & & \\ \hline 300 & & & & \\ \hline 350 & & & & \\ \hline 400 & & & & \\ \hline \end{array}$ Table 9-2 lists the various pounds (lbs.) of apples that Margie Stattler can sell. Assume that Margie operates in a perfectly competitive market. -Refer to Table 9-2.How many pounds of apples should Margie sell to maximize her profit?

A) 300 pounds B) 400 pounds C) This cannot be determined without knowing Margie's total or marginal production costs. D) This can be determined only when all of the values for market price, total revenue, average revenue and marginal revenue are given. A) 300 pounds B) 400 pounds C) This cannot be determined without knowing Margie's total or marginal production costs. D) This can be determined only when all of the values for market price, total revenue, average revenue and marginal revenue are given.

Exam 9: Firms in Perfectly Competitive Markets

Figure 9-6 Figure 9-6 shows the demand, marginal cost (MC) and average total cost (ATC) curves for Jason's House of Apples. -Refer to Figure 9-6.To maximize his profit,Jason should produce the level of output indicated by point

(Multiple Choice)

4.8/5

(85)

Question 221

If a perfectly competitive firm's price is above its average total cost,the firm

(Multiple Choice)

4.7/5

(83)

Question 222

Suppose Veronica sells teapots in the perfectly competitive teapot market.Her output per day and her costs are as follows: Output per Day Total Cost 0 \ 20 1 32 2 37 3 48 4 61 5 75 6 92 7 113 8 136 Suppose the current equilibrium price in the teapot market is $10.To maximize profit,how many teapots will Veronica produce,what price will she charge,and how much profit (or loss)will she make? Draw a graph to illustrate your answer.Your graph should include Veronica's demand,ATC,AVC,MC,and MR curves,the price she is charging,the quantity she is producing,and the area representing her profit (or loss).

(Essay)

4.9/5

(80)

Question 223

Molly Sharp is producing a documentary about the plight of the six-toed ferrets of Sri Lanka.Molly has spent $125,000 of her own money on this project and the documentary is now complete.Molly just found out that no studio is willing to release her documentary and she must now shop it to cable television networks,where she knows she will not be able to recoup her investment.Which of the following statements regarding Molly Sharp's documentary is true?

(Multiple Choice)

4.9/5

(85)

Question 224

In a perfectly competitive industry,in the long-run equilibrium

(Multiple Choice)

4.9/5

(65)

Question 225

If the market price is $40 in a perfectly competitive market,the marginal revenue from selling the fifth unit is

(Multiple Choice)

4.9/5

(85)

Question 226

Figure 9-7 Figure 9-7 illustrates the cost curves of a perfectly competitive firm. -Refer to Figure 9-7.If the market price is P₃ the firm

(Multiple Choice)

4.9/5

(91)

Question 227

The short-run supply curve for a perfectly competitive firm is that part of the firm's marginal cost curve that lies above the minimum point of its average variable cost curve.

(True/False)

4.9/5

(90)

Question 228

Figure 9-5 Figure 9-5 shows cost and demand curves facing a typical firm in a constant-cost, perfectly competitive industry. -Refer to Figure 9-5.If the market price is $20,what is the amount of the firm's profit?

(Multiple Choice)

4.9/5

(71)

Question 229

The demand curve for each seller's product in perfect competition is horizontal at the market price because

(Multiple Choice)

4.7/5

(75)

Question 230

If a typical firm in a perfectly competitive industry is earning profits,then

(Multiple Choice)

4.9/5

(85)

Question 231

Table 9-1 Quantity Total Cost (dollars) Variable Cost (dollars) 0 \ 1,000 \ 0 100 1,360 360 200 1,560 560 300 1,960 960 400 2,760 1,760 500 4,000 3,000 600 5,800 4,800 Table 9-1 shows the short-run cost data of a perfectly competitive firm that produces plastic camera cases. Assume that output can only be increased in batches of 100 units. -Refer to Table 9-1.What is the fixed cost of production?

(Multiple Choice)

4.7/5

(90)

Question 232

If a firm shuts down,it

(Multiple Choice)

4.8/5

(85)

Question 233

Table 9-1 Quantity Total Cost (dollars) Variable Cost (dollars) 0 \ 1,000 \ 0 100 1,360 360 200 1,560 560 300 1,960 960 400 2,760 1,760 500 4,000 3,000 600 5,800 4,800 Table 9-1 shows the short-run cost data of a perfectly competitive firm that produces plastic camera cases. Assume that output can only be increased in batches of 100 units. -Refer to Table 9-1.If the market price of each camera case is $8 and the firm maximizes profit,what is the amount of the firm's profit or loss?

(Multiple Choice)

4.9/5

(77)

Question 234

If a firm in a perfectly competitive industry introduces a lower-cost way of producing an existing product,the firm will be able to earn economic profits in the long run.

(True/False)

4.9/5

(93)

Question 235

What is the relationship among the following variables for a perfectly competitive firm: the market price,average revenue and marginal revenue?

(Multiple Choice)

4.9/5

(81)

Question 236

Firms in perfect competition produce the allocatively efficient output in the short run and in the long run.

(True/False)

4.8/5

(75)

Question 237

Figure 9-2 -Refer to Figure 9-2.What is the amount of profit if the firm produces Q₂ units?

(Multiple Choice)

4.7/5

(74)

Question 238

Table 9-2 Apples (pounds) MarketPrice per Pound Total Revenue ( TR) Average Revenue (AR) Marginal Revenue (MIR) 0 \ 3 \ 0 \@cdots \@cdots 100 150 200 250 300 350 400 Table 9-2 lists the various pounds (lbs.) of apples that Margie Stattler can sell. Assume that Margie operates in a perfectly competitive market. -Refer to Table 9-2.How many pounds of apples should Margie sell to maximize her profit?

(Multiple Choice)

4.9/5

(81)

Question 239

If,for the last bushel of apples produced and sold by an apple farm,marginal revenue exceeds marginal cost,then in producing that bushel the farm

(Multiple Choice)

4.7/5

(80)

Question 240

Figure 9-6 Figure 9-6 shows the demand, marginal cost (MC) and average total cost (ATC) curves for Jason's House of Apples. -Refer to Figure 9-6.To maximize his profit,Jason should produce the level of output indicated by point

If a perfectly competitive firm's price is above its average total cost,the firm

In a perfectly competitive industry,in the long-run equilibrium

If the market price is $40 in a perfectly competitive market,the marginal revenue from selling the fifth unit is

Figure 9-7 Figure 9-7 illustrates the cost curves of a perfectly competitive firm. -Refer to Figure 9-7.If the market price is P₃ the firm

The short-run supply curve for a perfectly competitive firm is that part of the firm's marginal cost curve that lies above the minimum point of its average variable cost curve.

Figure 9-5 Figure 9-5 shows cost and demand curves facing a typical firm in a constant-cost, perfectly competitive industry. -Refer to Figure 9-5.If the market price is $20,what is the amount of the firm's profit?

The demand curve for each seller's product in perfect competition is horizontal at the market price because

If a typical firm in a perfectly competitive industry is earning profits,then

If a firm shuts down,it

If a firm in a perfectly competitive industry introduces a lower-cost way of producing an existing product,the firm will be able to earn economic profits in the long run.

What is the relationship among the following variables for a perfectly competitive firm: the market price,average revenue and marginal revenue?

Firms in perfect competition produce the allocatively efficient output in the short run and in the long run.

Figure 9-2 -Refer to Figure 9-2.What is the amount of profit if the firm produces Q₂ units?

If,for the last bushel of apples produced and sold by an apple farm,marginal revenue exceeds marginal cost,then in producing that bushel the farm

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, The Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology,Production,and Costs

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

GDP: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, The Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money,Banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, International Trade, and Exchange Rates

Filters