Exam 44: Perfect Competition

The figure given below shows the demand and cost curves of a perfectly competitive firm. Figure: 23.4 D: Demand curve MC: Marginal cost curve ATC: Average-total cost curve AVC: Average-variable-cost curve Refer to Figure 23.4.The total profit or loss for the firm is:

The following figure shows equilibrium at the industry and firm level. Figure 23.6 In the figure, S₁, S₂, S₃ are the market supply curves. D₁ and D₂ are the market demand curves. MC is the marginal cost curve of the firm. MR₁ and MR₂ are the marginal revenue curves of the firm. ATC is the average-total-cost curve of the firm. According to Figure 23.6, in the long run, the firm:

The figure given below shows the revenue and cost curves of a perfectly competitive firm. Figure 23.1 In Figure 23.1, the firm maximizes its profit at an output level of _____ units.

For a perfectly competitive firm the break-even price is equal to the shutdown price in the short run.

If a firm in a perfectly competitive market raises its price:

The figure given below shows the demand and cost curves of a perfectly competitive firm. Figure: 23.4 D: Demand curve MC: Marginal cost curve ATC: Average-total cost curve AVC: Average-variable-cost curve According to Figure 23.4, the firm's shutdown price is:

Quickie Inc. , a perfectly competitive firm, currently maximizes profit by producing 400 units of output.If its marginal cost is equal to $25 and its average total cost is $20, then how much is it earning in economic profit?

For a farmer, the long run would be the current growing season, where she can vary the amount of irrigation, pesticides, and fertilizer on a fixed number of acres planted.

A perfectly competitive firm maximizes its profit when:

In long-run equilibrium in perfect competition, the entry and exit of firms will drive economic profits to zero.

An increase in price facing a perfectly competitive firm means that the profit-maximizing output level will increase.

The figure given below shows the revenue and cost curves of a perfectly competitive firm. Figure 23.2 MC: Marginal cost curve MR: Marginal revenue curve ATC: Average-total-cost curve AVC: Average-variable-cost curve Refer to Figure 23.2.Compute the profit earned by the firm at the profit-maximizing level of output.

The profit of a perfectly competitive firm is maximized at a level of output where its marginal cost is rising.

The table given below shows the price of each unit of the product manufactured by a firm and the marginal cost of producing different units of the output. Table: 23.1 Refer to Table 23.1.The firm depicted in the table is a(n):

In the short run a firm continues to produce only if it can cover the:

The figure given below shows the revenue and cost curves of a perfectly competitive firm. Figure 23.5 MC: Marginal cost curve MR: Marginal revenue curve. ATC: Average-total-cost curve AVC: Average-variable-cost curve According to Figure 23.5, the firm has:

The following figure shows equilibrium at the industry and firm level. Figure 23.6 In the figure, S₁, S₂, S₃ are the market supply curves. D₁ and D₂ are the market demand curves. MC is the marginal cost curve of the firm. MR₁ and MR₂ are the marginal revenue curves of the firm. ATC is the average-total-cost curve of the firm. According to Figure 23.6, at a price of $1, the firm would earn an economic profit of:

If a perfectly competitive firm's price increases, then:

If the marginal cost exceeds the marginal revenue, a perfectly competitive firm should:

When firms leave a perfectly competitive market, then, other things remaining unchanged: