Exam 12: Perfect Competition

-The table above gives the total revenue and total cost for a perfectly competitive firm producing chocolate chip cookies. If the firm increases its output from 2 pounds of cookies to 3 pounds, the marginal revenue is ________ per pound of cookies.

If the minimum efficient scale of a firm is small relative to the demand for the good, then

-The figure above shows a firm in a perfectly competitive market. If the firm does not shut down, the least amount of output that it will produce is

A perfectly competitive market is in long-run equilibrium. Then demand decreases. The decrease in demand leads to

-The figure above shows a firm in a perfectly competitive market. The firm's supply curve is the curved line linking

In perfect competition, the

-Sue's Sea Shells by the Sea Shore is a perfectly competitive firm selling sea shells at the market price of $2 per dozen. Sue's Sea Shells by the Sea Shore has fixed costs of $40 per day and a variable cost schedule in the table above. The maximum profit attainable by Sue's Sea Shells by the Sea Shore is

-In the above figure, if the price is $8 per unit, how many units will a profit maximizing perfectly competitive firm produce?

-The table above gives the total revenue and total cost for a perfectly competitive firm producing chocolate chip cookies. If the firm increases its output from 2 pounds of cookies to 3 pounds, the marginal cost is ________ per pound of cookies.

-In the long run, the firms in a perfectly competitive market

Suppose the bobby pin industry is perfectly competitive. The price of a packet of bobby pins is $2.00. Pins and Needles, Inc. is a firm in this industry and is producing 1,000 packets of bobby pins per day at the point where the MC = MR. The average cost of production at this output level is $1.50 per packet. a) What is the marginal cost of the 1,000th packet? b) Is this firm making an economic profit, zero economical profit, or an economic loss? How much? c) Is the firm in long-run equilibrium? Why or why not?

A perfectly competitive firm initially is earning zero economic profit. Then, a decrease in demand for the firm's product occurs. Of the following, in the long run which action listed below is the firm most likely to take?

In perfect competition, an individual firm

-Archibald's Tattoos is a perfectly competitive firm. The firm's costs are shown in the table above. What is Archibald's shut-down point?

Suppose some firms in a perfectly competitive market are incurring an economic loss. As a result,

-The table above shows the total cost incurred by Sue's Coat Shop, a perfectly competitive firm. If the market price of a coat is $285, Sue's will maximize economic profit by selling ________ coats a day.

The short-run supply curve for a perfectly competitive firm is its marginal cost curve above the minimum point on the

-In the above figure, at any price between $8 per unit to $12 per unit, how many units will a profit-maximizing perfectly competitive firm produce?

If perfectly competitive firms exit a market, the

A perfectly competitive firm is more likely to shut down during a recession, when the demand for its product declines, than during an economic expansion, because during the recession it might be unable to cover its