5 The table shows total cost and total revenue information for a perfectly (or purely) competitive firm.QuantityTotal costTotal revenueIf the cost and revenue numbers in the table will continue500forever (permanently), what is the best option forthis firm?O minimize lossesmaximize production at 10 units of goodsshut downO exit the market16001357102703.830405496054011006756.1250810714109458.158010809.176012151019501350

In perfect competition there are large number of firms selling homogeneous goods.

The table shows total cost and total revenue information for a perfectly (or purely) competitive firm. Quantity Total cost Total revenue If the cost and revenue numbers in the table will continue 500 600 forever (permanently), what is the best option for 1 135 this firm? 710 270 O minimize losses maximize production at 10 units of goods 3. 830 405 4. 960 540 1100 675 shut down 6. 1250 810 O exit the market 1410 945 8. 1580 1080 9. 1760 1215 10 1950 1350

The table shows total cost and total revenue information for a perfectly (or purely) competitive firm. Quantity Total cost Total revenue If the cost and revenue numbers in the table will continue 500 600 forever (permanently), what is the best option for 1 135 this firm? 710 270 O minimize losses maximize production at 10 units of goods 3. 830 405 4. 960 540 1100 675 shut down 6. 1250 810 O exit the market 1410 945 8. 1580 1080 9. 1760 1215 10 1950 1350

Principles of Economics, 7th Edition (MindTap Course List)

7th Edition

ISBN:9781285165875

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Firms In Competitive Markets

Section: Chapter Questions

Problem 4PA

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Similar questions

If new technology in a perfectly competitive market brings about a substantial reduction in costs of production, how will this affect the market?
Briefly explain the reason for the shape of a marginal revenue curve for a perfectly competitive firm.
Since a perfectly competitive firm can sell as much as it wishes at the market price, why can the firm not simply increase its profits by selling an extremely high quantity?
Suppose that each firm in a competitive industry has the following costs: Total cost: TC = 50 + q2 Marginal cost: MC = q where q is an individual firms quantity produced. The market demand curve for this product is Demand:QD = 120 P where P is the price and Q is the total quantity of the good. Currently, there are 9 firms in the market. a. What is each firms fixed cost? What is its variable cost? Give the equation for average total cost. b. Graph average-total-cost curve and the marginal-cost curve for q from 5 to 15. At what quantity is average-total-cost curve at its minimum? What is marginal cost and average total cost at that quantity? c Give the equation for each firms supply curve. d. Give the equation for the market supply curve for the short run in which the number of firms is fixed. e. What is the equilibrium price and quantity for this market in the short run? f. In this equilibrium, how much does each firm produce? Calculate each firms profit or loss. Is there incentive for firms to enter or exit? g. In the long run with free entry and exit, what is the equilibrium price and quantity in this market? h. In this long-run equilibrium, how much does each firm produce? How many firms are in the market?
What are the four basic assumptions of perfect competition? Explain in words what they imply for a perfectly competitive firm.