A computer manufacturer produces 300 PCs (personal computers) per week and experiences a cost of $400 per PC. Two years later it expands and changes all of its inputs and produces 500 PCs per week and finds that its cost are now $350 per PC. Which phenomenon does this describe and what is the explanation for this? Question 4 List the four characteristics of a perfectly competitive industry and give one example of an industry that is perfectly (or close to perfectly) competitive.

A computer manufacturer produces 300 PCs (personal computers) per week and experiences a cost of $400 per PC. Two years later it expands and changes all of its inputs and produces 500 PCs per week and finds that its cost are now $350 per PC. Which phenomenon does this describe and what is the explanation for this? Question 4 List the four characteristics of a perfectly competitive industry and give one example of an industry that is perfectly (or close to perfectly) competitive.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter22: Perfect Competition

Section: Chapter Questions

Problem 6WNG

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Similar questions

Question 2 Which of the following firms is the closest to being a perfectly competitive firm? Group of answer choices the Los Angeles Dodgers Apple, Inc. a wheat farmer in Kansas DeBeers diamond wholesalers
Question 4 List the four characteristics of a perfectly competitive industry and give one example of an industry that is perfectly (or close to perfectly) competitive.
37) In a perfectly competitive industry, the market price of the product is $15. Firm A is currently producing 300 units. The firm's marginal cost is $15, its fixed costs amount to $1000 and its average variable cost equals $10. Which one of the following is true for this firm?a) it’s profits are 500 $b) it’s profits are -500 $c) it’s profits are -1500 $d) it’s profits are 1500 $
Question 18 Which of the following statements is not correct for perfectly competitive firms? The firm’s decision in the short-run to shut down is when price is lower than average variable cost. The firm maximizes profit by producing the quantity at which marginal cost equals marginal revenue. The firm’s decision in the long-run to exit is when price is higher than average total cost. Price is equal to marginal revenue and average revenue.
A perfectly competitive firm currently sells each unit of output at $3 and faces an average total cost of $5 at optimal output. What should the firm do? 1) Exit the industry as it is making a loss. 2) Continue to produce at the current output. 3) Continue to produce but reduce output. 4) Not possible to tell.
QUESTION 1 A perfectly competitive firm has the following total cost function: Total output Total Cost 0 20 1 30 2 42 3 55 4 69 5 84 6 100 7 117 How much will the firm produce if the price of the production the market is Rs. 14 per unit? How will it change its output if price rises to Rs. 16 per unit?