Q: In the long-run, any perfectly competitive firm that produces will choose a quantity such that
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Q: Why do you think a firm in a perfectly competitive industry does not have market power?
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Q: In the long-run, a perfectly competitive firm will earn what kind of economic profit?
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Q: For a perfectly competitive firm, what is the relationship between Price and Marginal Revenue?
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Q: Illustrate and fully discuss the derivation of the demand curve for a perfectly competitive firm
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Q: Which of the following is true concerning purely competitive industries?
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- you and the other hamburger shops that just opened in the area are selling the same basic hamburgers. Every other shop is selling their hamburger for 2.00$ per hamburger. you are now a price taker in a perfectly competitive market where the price of a hamburger is 2.00$As we begin to study different market structures, consider a market that is fiercely competitive. List the industry. What are the pros and cons of competition? Is competition in this industry a good thing? Why or why not? Would you say this is a purely competitive industry? Explain.Scenario: You and the other donut shops that just opened in your area are all selling the same basic donuts. Every other shop is selling their donuts for $1.00 per donut. You are now a price taker in a perfectly competitive market where the price of a donut is $1.00. Assume you currently have capacity at your shop to make 50,000 donuts. Quantity Variable Costs Fixed Costs Price Total Costs Total Revenue Profit Marginal Costs 2,000 $2,000 $10,000 $1 3,000 $2,500 $10,000 $1 5,000 $3,500 $10,000 $1 10,000 $4,000 $10,000 $1 15,000 $7,000 $10,000 $1 25,000 $20,000 $10,000 $1 50,000 $80,000 $10,000 $1 Step Two Respond to the following: Based on your work during the Start Your Own Donut Shop assignment, what price did you originally plan to charge per donut? Based on your current quantities and costs, can you sell donuts for $1.00 and still make…
- A perfectly competitive market has a demand curve given by the equation Q = 2000 − 2p where Q is the market quantity demanded and P the price per unit. Each firm in the market has the total cost given by TC = 1000 + 100q + 10q' and the marginal cost MC = 100 + 20q If the current market price is $400, 1. Calculate the market quantity , profit and quantity maximizing profit for each firm and Graph your results. OK 2. Suppose that the market is in the long run.How much profit will each firm earn and what will be the market price and What is the market quantity and price ? 3 How many firms operate in this marketAssume the firms in a perfectly competitive market are initially incurring economic losses. An increase in supply would cause existing firms' economic losses to decrease. True OR False?Q94 A perfectly competitive firm is currently producing an output level where price is $10.00, average variable cost is $6.00, average total cost is $10.00 and marginal cost is $8.00. To maximise profits, this firm should... a. Increase its output. b. Increase the market price. c. Decrease its output. d. Produce zero output. e. Not change its output.
- 30) Which one of the following is true for a perfectly competitive industry? a) there are many big firms b) firms have some influence on the price c) each firm produces identical homogenous products d) entry and exit to the market is not freeWhat is the main characteristic of a perfectly competitive market?A. Many sellers with differentiated productsB. Few sellers with differentiated productsC. Many sellers with identical productsD. Few sellers with identical productsSuppose that firm is in a breaking even status in a perfectly competitive market. Using graphs (for both industry and firm) to explain how a decline in demand in the short run affects some firms’ performance (e.g., earn profits or experience loss). In the long run, how this results in exit of some firms from the same perfectly competitive market. Comment on the market equilibrium quantity and price in the long run?
- Here i a list of the following conditions of a perfectly competitive market.Which characteristic is wrong for a perfectly competitive market? a)There is complete information b)Firms products are differentiated c)The number of firms is large d)Firms are price takers e)There are any barriers to entryWhat are the three conditions for a market to be perfectly competitive? For a market to be perfectly competitive, there must be A. many buyers and sellers, with all firms selling identical products, and no barriers to new firms entering the market. B. many buyers and nothingsellers, with all firms selling identical products, and substantial barriers to new firms entering the market. C. many buyers and sellers, with firms selling similar but not identical products, with low barriers to new firms entering the market. D. many buyers and one seller, with the firm producing a product that has no close substitutes, and barriers to new firms entering the market.Why do sellers in perfectly competitive industries have no market power? a. There are large number of buyers and sellers. b. They all sell the same/identical goods. c. There are perfect substitutes available for the goods sold by any particular seller because they all sell identical goods. d. All of the above. e. None of the above.
