What two rules does a perfectly competitive firm apply to determine its profit-maximizing quantity of output?

Q: In the long-run, any perfectly competitive firm that produces will choose a quantity such that

A: The market is a location where the transaction of services and commodities takes place. It is…

Q: Explain briefly why a firm under perfect competition is a price taker not a price maker?

A: A market is the collection of buyers and sellers. There are different forms of markets based on…

Q: Can a perfectly competitive firm set its own market price?

A: Perfect or pure competition is a form of market in which a large number of perfectly informed buyers…

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: Which of the following is always true when a perfectly competitive firm is producing at a profit…

A: Perfect competition(PC) is a market in which there is a complete absence of competition among the…

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: Explain the three conditions held at the long-run equilibrium in a perfectly competitive market with…

A: Perfectly Competitive Market:It is a market situation where a large number of firms exist and there…

Q: must each perfectly competitive firm be in equilibrium if the industry is in the long-run…

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

Q: • Please explain the difference between the short run and long run equilibrium under a per- fectly…

A: Perfect competition is the market structure which is characterized by a large number of firms with…

Q: If you are the manager of a perfectly competitive firm that is making a loss (TR < TC), would you…

A: Any manager worth his salt would aspire to maximize profits and minimize losses.  When the total…

Q: Do you agree with the following statement and explain why! "A firm that operates in a perfectly…

A: Perfectly competitive market is a market where there are many buyers and sellers in the market…

Q: The graph below shows a perfectly competitive firm in short run equilibrium, where the firm has…

A: The profit-maximizing output level is acquired at the intersection of the marginal cost and marginal…

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

A: There are different market structures with different characteristics.

Q: Explain why perfectly competitive firms are classified as a price taker

A: Answer - Price Taker Firm - The price taker firm are those firm who has not the ability to influence…

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: Explain why a perfectly competitive firm earns zero economic profits in the long run.

A: In an economy, different types of markets exist to make an exchange of different types of products.…

Q: If the price of a product produced by a perfectly competitive firm falls below the average total…

A: Perfect competition refers to the situation where there are many buyers and sellers exist in the…

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

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

Q: How does a perfectly competitive firm decide what price to charge?

A: Firms in a perfectly competitive market cannot influence the price as there are large numbers of…

Q: Is it true that a firm in a perfectly competitive market will never be able to earn positive…

A: There are different types of market which are broadly grouped as: Perfect competition and Imperfect…

Q: explain three conditions that characterise a perfectly competitive market

A: To promote the trade of products and services, a marketplace where two or more parties could meet.…

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: equilibrium

A: The equilibrium of the perfectly competitive firm from the equilibrium of the industry is different…

Q: What prevents a perfectly competitive firm from seeking higher profits by increasing the price that…

A: In a perfectly-competitive market, there are theoretically infinite number of frim. Each firm here…

Q: Graphically explain the profit maximization condition of a perfect competitive firm.

A: In the perfectly competitive market, a firm experiences a situation that the average revenue will be…

Q: Based on the characteristics of perfectly competitive market explain why firms in this market are…

A: Perfect competition is a type of market structure in which there are large number of buyers and…

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: • Please explain why the long run economic profit is zero under a perfectly competitive market in…

A:

Q: If a firm makes zero economic profit, it will exit the market in the long run. Do you agree?…

A: No economic profit is also referred as normal profit. Economic profit is calculated by subtracting…

Q: List the characteristics needed for a perfectly competitive market. Provide a simple explanation of…

A: A perfectly competitive market is the market in which there are lots of buyers and sellers, buying…

Q: Explain in detail how a perfectly competitive firm makes its profitmaximizing decision.

A: Perfectly competitive market:- The market structure in which there are no barriers on entry and exit…

Q: Explain whether a perfectly competitive market is more efficient for buyers to buy or sellers to…

A: When perfectly competitive markets combine with utility-maximizing buyers, the resulting quantity of…

Q: Graphically show how the profit-maximizing level of output is determined for the perfectly…

A: Perfect competitive firm is a price taker and can sell any quantity of commodity at the market…

Q: What are the five features of a perfect market competitive?

A: There are many market structures in the economy. Some of them are, perfect competition, monopoly,…

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: Briefly describe what the effect of producing a greater quantity of products will be in relation to…

A: Introduction A perfectly competitive firm simply has to make one fundamental decision: how much to…

Q: condition for profit maximization for a pure

A:

Q: Will a profit-maximizing firm in a competitive market ever produce a positive level of output in the…

A: The change in total cost to change in output is known as marginal cost. The marginal cost is the…

Q: Explain what the long run profit conditions are for a perfectly competitive market

A: Perfectly Competitive Market is the one where there are large number of buyers and sellers, selling…

Q: Refer to the above graph for a purely competitive firm in the short run. What minimum output level…

A: In order to answer this question, it is imperative to understand the concepts of breakeven and…

Q: Why is the marginal revenue curve for a perfectly competitive firm the same as its demand curve?

A: Perfect or pure competition is a form of market in which a large number of perfectly informed buyers…

Q: Illustrate and fully discuss the derivation of the demand curve for a perfectly competitive firm

A: Perfect Competition Conditions An economic examination of a company's production decisions considers…

Q: What is the meaning of ‘acceptable loss’ for a perfectly competitive firm ?

A: