Suppose the wholesale market for corn is a perfectly competitive market, and all firms in the corn industry are profit-maximizing firms. Consider that the market is in short-run equilibrium. Which of the following statements are correct? Choose one or more: A. Total costs for each firm in the market may be different. B. All firms in the market must be earning identical profits. C. All firms selling corn must have the same marginal cost, regardless of each firm's cost structure. D. Firms that choose not to sell in this market must be earning exactly zero profit. E. All firms in the market must be making either positive profits, or exactly zero profit.
Suppose the wholesale market for corn is a perfectly competitive market, and all firms in the corn industry are profit-maximizing firms. Consider that the market is in short-run equilibrium. Which of the following statements are correct? Choose one or more: A. Total costs for each firm in the market may be different. B. All firms in the market must be earning identical profits. C. All firms selling corn must have the same marginal cost, regardless of each firm's cost structure. D. Firms that choose not to sell in this market must be earning exactly zero profit. E. All firms in the market must be making either positive profits, or exactly zero profit.
Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter22: Perfect Competition
Section: Chapter Questions
Problem 4QP
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Transcribed Image Text:Suppose the wholesale market for corn is a perfectly competitive market, and all firms in the corn industry are profit-maximizing firms.
Consider that the market is in short-run equilibrium. Which of the following statements are correct?
Choose one or more:
A. Total costs for each firm in the market may be different.
B. All firms in the market must be earning identical profits.
C. All firms selling corn must have the same marginal cost, regardless of each firm's cost structure.
D. Firms that choose not to sell in this market must be earning exactly zero profit.
E. All firms in the market must be making either positive profits, or exactly zero profit.
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