Exam 8: Competitive Firms and Markets

Suppose that once a well is dug,water flows out of it continuously without any additional effort.Customers collect their water and pay a per gallon fee when they leave the site of the well.In the short run,the competitive firm in this market

If a firm is a price taker,then its marginal revenue will always equal

-The above figure shows the cost curves for a typical firm in a competitive market.If price = 8.5,then

If a firm happened to be the only seller of a particular product,it might behave as a price taker as long as

The competitive firm's supply curve is equal to

Assuming a horizontal long-run market supply curve,which of the following statements is (are)TRUE about competitive firms in the long run?

A firm will shut down in the short run if

If a competitive firm cannot earn profit at any level of output during a given short-run period,then which of the following is LEAST likely to occur?

Even though fixed costs do not affect the output decision,an increase in fixed costs results in a wider range of prices for which the firm operates at a loss.

Many car owners and car dealers describe their different cars for sale in the local newspapers and list their asking price.Many people shopping for a used car consider the different choices listed in the paper.The absence of which condition prohibits this market from being described as perfectly competitive?

Suppose that there are 80 firms in a market,each with the following cost function: C(q)= 100 + 4q² a.Derive the short-run market supply curve. b.Suppose the market demand is Q_D = 1280 - 30p Find the equilibrium market quantity and price. c.How much output will each firm produce? How much profit is each firm making?

In a competitive market,if buyers did not know all the prices charged by the many firms,