A competitive firm maximizes profit when marginal cost: a. equals the price. b. is less than the price. c. is minimized. d. is greater than the price.
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- The value of marginal revenue is $35 and the value of marginal cost is $30 Is the firm maximizing profits?Perfect Competition MC - Marginal Cost MR - Marginal Revenue ATC - Average Total Cost AVC - Average Variable Cost Refer to the figure above. If this firm decides to operate and is producing the profit-maximizing quantity, then the firm's profit will be: $40 $0 - $40 $240microeconomics . This firm will maximize profit by producing at output level: (pick the correct letter) f g h j
- (A) Comment on marginal revenue and marginal cost values when it is given that marginal profit is 0. (B) Also comment on total profit value of the firm.True/false There is no selling cost incur in the perfect competition market.A profit-maximizing firm in a competitive market is currently producing 100 units of output. It has average revenue of $10, average total cost of $8, and fixed cost of $200.\a. What is its profit?b. What is its marginal cost?c. What is its average variable cost?d. Is the efficient scale of the firm more than, less than, or exactly 100 units?
- The value of Marginal revenue is $40 and the value of marginal cost is $30. Is the firm maximizing profits True/FalseIn perfect competition, a firm has __________ market power. A. No B. High C. Low D. CompleteShow all the work clear handwriting Suppose the market price of a good is $20 and TC=0.5Q2. A. What Q should a profit maximizing perfectly competitive firm choose? B. What are profits? C. Draw a graph that shows the short run choice of Q, revenue and profits.
- a. A firm operating in a perfectly competitive market is earning K20 million economic profits. What is the firms accounting profits if the opportunity cost is K30 millionb. What will be the firm’s economic profits in the long run? c. Company ‘A’ has been recording accounting profits averaging K50 million by investing in project C. It could earn K60 million and K70 million in projects D and E, respectively. What is the company’s current economic profit? d. Advise management what to do in the long run e. Project ‘B’ has a net present value of zero after applying a discount rate of 10%, which is the risk adjusted required rate of return that takes into account the riskiness of the project. What return is earned on this project f. After a risk assessment, it is discovered that project ‘B’ has become more risky and the risk adjusted required return to use must be 12%. Will the net present value of project ‘B’ still remain zero?The firm will A-increase its marginal revenue B increased its profits C decrease its marginal revenue D maximize its profitsWhen a perfectly competitive firm increases thequantity it produces and sells by 10 percent, itsmarginal revenue _________ and its total revenuerises by _________.a. falls; less than 10 percentb. falls; exactly 10 percentc. stays the same; less than 10 percentd. stays the same; exactly 10 percent