How does fixed cost affect marginal cost? Do fixed costs affect perfectly competitive firm’s output decisions in the short run? Briefly explain your answer. Are there fixed costs in the long run? Do fixed costs affect perfectly competitive firm’s output decisions in the long run? Explain your answers briefly

How does fixed cost affect marginal cost? Do fixed costs affect perfectly competitive firm’s output decisions in the short run? Briefly explain your answer. Are there fixed costs in the long run? Do fixed costs affect perfectly competitive firm’s output decisions in the long run? Explain your answers briefly

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter12: Firms In Perfectly Competitive Markets

Section: Chapter Questions

Problem 9P

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Similar questions

According to the accompanying table, what quantity of output should the firm produce? Explain your answer.
Do fixed costs affect perfectly competitive firm’s output decisions in the short run? Briefly explain your answer. Are there fixed costs in the long run? Do fixed costs affect perfectly competitive firm’s output decisions in the long run? Explain your answers briefly.
-Briefly discuss average costs, including how they are calculated, how they are typically appear on a graph, and what they relate to profitability. -Briefly explain what is meant by the term "fixed costs" and provide three examples of same. What determines a firm's level of fixed costs? -Briefly explain what is meant by the term "variable costs" and provide three examples of same. -Briefly explain how the total revenue for a profit-seeking firm is determined.
he following graph summarizes the demand and costs for a firm that operates in a perfectly competitive market. What level of output should this firm produce in the short run? What price should this firm charge in the short run? What is the firm’s total cost at this level of output? What is the firm’s total variable cost at this level of output? What is the firm’s fixed cost at this level of output? What is the firm’s profit if it produces this level of output? What is the firm’s profit if it shuts down? In the long run, should this firm continue to operate or shut down? problem 1-6 are solved, this is subparts.
Related to the Economics in Practice on page 195: If firms have long-run average cost curves with a long, flat section, larger firms have a cost advantage over smaller firms. the optimal number of firms in the industry is one. their long run supply curves are downward sloping. it is impossible to predict the size of the firm.
A firm sells 1,000 units per week. Suppose the average variable cost is $15, and the average cost is $55. In the short run, the break-even price is:___?_____. . In the long run, the break-even price is . Suppose the firm charges a price of $5 per unit. Use the following table to indicate whether the firm will shut down or continue to produce in the short run and the long run. Time Continue to Produce Shut Down Short Run ? ? Long Run ? ?
What are Megan’s fixed costs? Given the nature of sidewalk shoveling production, why does Megan’s marginal cost curve look like it does in your graph? Suppose the market price for shoveling a sidewalk is $20 per sidewalk. How many sidewalks will Megan shovel each day to maximize profit? Suppose the market price of shoveling a sidewalk rises to $25 because it has been a snowy winter. How many sidewalks will Megan shovel each day to maximize profit?
In the short run, if a marginal cost of a firm in a competitive industry is increasing while its average variable cost is upward sloping, what can you say about slope of average total cost?
The market for fertilizer is perfectly competitive. Firms in the market are producing output but are currently incurring economic losses. How does the price of fertilizer compare to the average total cost, the average variable cost, and the marginal cost of producing fertilizer? Draw two graphs, side by side, illustrating the present situation for the typical firm and for the market. Assuming there is no change in either demand or the firms’ cost curves, explain what will happen in the long run to the price of fertilizer, marginal cost, average total cost, the quantity supplied by each firm, and the total quantity supplied to the market.
As of 2019, the US department of agriculture (USDA) did not have detailed guidelines for egg farmers to follow before they could claim that the eggs they sell were laid by cage free chickens. some animal rights activists were pushing for the USDA to enact stricter guidelines that many egg farmers were following voluntarily. Such guidelines would be likely to significantly raise the cost of producing cage free eggs. Suppose that the USDA begins to require these stricter guidelines. What effect will this increase in cost have on the long run price of cage free eggs? In the long run, will the quantity of cage free eggs be larger, smaller, or the same as it would have been without the USDA adopting the guidelines? briefly explain.
Can you explain to me why in the short run, firms only use variable cost to determine whether or not to shut down.