How does a competitive firm determine the quantity that maximizes profit?

Q: You read in a business magazine that farmers are reaping high profits. With the theory of perfect…

A: A perfect competition exist when there are large number of buyers and sellers in the market and the…

Q: Discuss the economic conditions that are necessary to achieve productive and allocative efficiency…

A: Productive efficiency: The productive efficiency exists at a level where per unit cost of producing…

Q: What is the Imperfect competition that refers to any form of market structure other than perfect…

A: Perfect competition refers to a market in which there is many seller and buyer dealing in a…

Q: How is it possible for perfectly competitive firms to maximize profit in the short run versus in the…

A: Perfect competition: Under the perfect competition market, the price is decided by the demand and…

Q: How would you describe the demand curve for the purely competitive firm? For the industry?

A: Purely competitive firms are characterised by being price takers where decisions are made…

Q: You read in a business magazine that farmers are reaping high profits. With the theory of perfect…

A: A perfect competition is a market structure where the price of the commodity sold is same and is…

Q: Why are perfectly competitive markets considered economically efficient?

A: There are several forms of the market that exists in the real world out of which perfect competition…

Q: What two lines determine whether a firm is making positive or negative or zero profits?

A: Introduction The perfect competitive firm only needs to decide on one thing: how much to make. To…

Q: When might a competitive firm shutdown in the short run and exit the market in the long run?

A: When a perfectly competitive firm finds itself in shutdown, that is, its market price is equal to…

Q: When will a firm enter a competitive market?

A: Perfect competition refers to the situation where there are large number of prouder and consumers…

Q: Which of the following conditions describe a perfectly competitive market?

A: Perfectly competitive market is a rare type of market which is difficult to find in the real…

Q: What is the relationship between economies of scale and the level of market competition?

A: Economies of scale help more than just the company that produces the goods. Consumers will benefit…

Q: What are the characteristics of a perfectively competitive market?

A: There are different market structures with different characteristics.

Q: In the long-run, a perfectly competitive firm will earn what kind of economic profit?

A: In the long run, a perfectly competitive firm will earn normal/zero economic profit.

Q: What happens when a perfectly competitive market is in equilibrium?

A: A perfectly competitive market is a market structure in which there are many buyers and sellers. The…

Q: In the short run, a competitive firms supply curve is

A: A perfectly competitive firm is price taker in nature, and hence faced a horizontal demand curve.

Q: When will a firm neither enter or exit a competitive market?

A: In competitive market firms are free to enter and exit.

Q: Evaluate the view that the main goal of firms will always be profit maximization

A: The profit is the excess revenue made by the firms after deducting the total cost of production from…

Q: Explain how economics make profit or loss when firms are perfectly competitive.

A: In a competitive market there are large number of firms producing similar and identical products…

Q: What are the Characteristics of a Purely Competitive Market?

A: Characteristics of a Purely Competitive Market:   The Purely competitive market is the market…

Q: Why does perfect competitive market need to be maintained?

A: In an economy, a perfectly competitive market is the place where anyone is allowed to enter or exit…

Q: Perfect competition is an extremely rare type of market in the real world. This is because the…

A: "Since you have asked a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Why is a firm in a perfectly competitive market called a price taker? How does a firm in perfect…

A: Price taker: It means a person or company accepting the prevailing prices in the market and unable…

Q: Briefly explain the reason for why in a competitive market we expect economic profits to be zero in…

A: A competitive market, also known as perfect competition, is a kind of market where there are a large…

Q: In a perfectly competitive market, what is the marginal revenue curve

A: Meaning of Perfectly Competitive Market: The perfectly competitive market exists when there is a…

Q: When is it the right time when a firm will enter a competitive market?

A: A competitive market is considered as one where firms have no opportunity to deviate from market…

Q: why does price equal marginal revenue for the perfectly competitive firm? what is the relationship…

A: Perfect competition refers to the type of market organization in which there are many buyers and…

Q: Why a competitive firm is price taker? Explain graphically why perfect competition is preferable to…

A: When the following conditions exist, firms are said to be in perfect competition: (1) many firms…

Q: What is the most important decision a perfectly competitive firm must make to maximize profit? what…

A: In a perfectly competitive market, there are many buyers and sellers. The good produced is…

Q: You read in a business magazine that farmers are reaping high profits. With the theory of perfect…

A: Perfect competition is many sellers dealing in commodity which is same in quality and price at which…

Q: Can you think of a product that meets at least most of the criteria required for a perfectly…

A: Perfectly competitive market refers to the market which has been characterized by the presence of…

Q: What is the firms profit or loss?

A: A firm in an exceedingly competitive market wants to maximise profits similar to the other firm.…

Q: Do you think firms really try to maximize profits? Do firms (especially small ones) know what prices…

A: Economist generally assume that firms act as profit maximisers. Economists don’t think there’s…

Q: 71. In the last video, what is the price the competitive firm receives for each bushel of apples it…

A: In a perfectly-competitive market, the firms are price takers. This means that regardless of the…

Q: Suppose that the market for cashmere sweaters is a competitive market. The following graph shows the…

A: A perfectly competitive firm maximizes profit by producing output at a level where Price is equal to…

Q: why competitive firms stay in business if they make zero profit?

A: First it should be clear that zero economic profit means that total Total Revenue is equal to the…

Q: A single firm in a perfectly competitive market is relatively small compared to the rest of the…

A: In the ‘perfect competition(PC)’ all firms sell ‘identical products’ that are homogeneous. Here all…

Q: Consider the graph of a firm in a perfectly competitive market to answer the question below: MC 10…

A: Profit is maximized at a point where MR is equal to MC.

Q: Suppose that the market for dress shirts is a competitive market. The following graph shows the…

A: Perfect competition refers to the situation where there is the large number of sellers and buyers…

Q: In the long run, a perfectly competitive firm can

A: The ideal kind of market structure is known as "perfect competition," and it occurs when all…

Q: What do you mean by the equilibrium of a firm?

A: According to the given question In Economics the firm is basically a central institution which helps…

Q: What is special about a purely competitive market?

A: A perfectly competitive market is the market in which there is perfect competition amongst buyers…