ECON 002 MICROECONOMICS W/CONNECT(LL)
18th Edition
ISBN: 9781260200089
Author: McConnell
Publisher: MCG CUSTOM
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Chapter 11, Problem 6DQ
To determine
Economic profit and innovation.
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Linda sells 100 bottles of homemade ketchup for $10 each. The cost of the ingredients, the bottles, and the labels was $700. In addition, it took her 20 hours to make the ketchup and to do so she took time off from a job that paid her $20 per hour. Linda’s accounting profit is while her economic profit is. LO9.1 a. $700; $400 b. $300; $100 c. $300; negative $100 d. $1,000; negative $1,100
Which of statement is true about economic profit in the long run.(LO2,3).
a) both the monopolistic and perfect competitor make one.
b) neither the monopolistic nor the perfect competitor makes one.
c) only the perfect competitor makes one.
d) only the monopolistic makes one.
Suppose that the pen-making industry is perfectly competitive. Also suppose that each current firm and any potential firms that might enter the industry all have identical cost curves, with minimum ATC = $1.25 per pen. If the market equilibrium price of pens is currently $1.50, what would you expect it to be in the long run? LO11.2 a. $0.25. b. $1.00. c. $1.25. d. $1.50.
Chapter 11 Solutions
ECON 002 MICROECONOMICS W/CONNECT(LL)
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