A firm operating in a perfectly competitive market cannot increase its profit. Which of the following must be true in the short run? A decrease in output will leave profits unchanged. The firm cannot be earning positive economic profit. The firm's average total costs equal marginal costs. The firm's demand curve is downward sloping. The firm's marginal cost equals its price.
A firm operating in a perfectly competitive market cannot increase its profit. Which of the following must be true in the short run? A decrease in output will leave profits unchanged. The firm cannot be earning positive economic profit. The firm's average total costs equal marginal costs. The firm's demand curve is downward sloping. The firm's marginal cost equals its price.
Chapter8: Perfect Competition
Section: Chapter Questions
Problem 6.13P
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10.
A firm operating in a
A decrease in output will leave profits unchanged.
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The firm cannot be earning positive economic profit.
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The firm's
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The firm's demand curve is downward sloping.
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The firm's marginal cost equals its
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12.
A dairy farmer is operating in a perfectly competitive market. The market price for milk is between the farmer'saverage variable cost and average total cost at the profit-maximizing level of output. What will the farmer do?
A dairy farmer is operating in a perfectly competitive market. The market price for milk is between the farmer's
Produce more milk
|
Produce less milk
|
Shut down in the short run
|
Operate in the short run and leave the industry in the long run
|
Insufficient information to determine
|
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