EBK ESSENTIALS OF ECONOMICS
7th Edition
ISBN: 8220102452107
Author: Mankiw
Publisher: CENGAGE L
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Question
Chapter 13, Problem 1QCMC
To determine
The characteristic of the perfect competitive firm.
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A perfectly competitive firma. chooses its price to maximize profits.b. sets its price to undercut other firms sellingsimilar products.c. takes its price as given by marketconditions.d. picks the price that yields the largestmarket share.
Which of the below changes in demand in the long-run would lead to entry in the perfectly competitive market for wheat?Ā Ā
Ā
a. a decrease in the number of buyers
Ā
b. a decrease in buyers' expected price of wheat
Ā
c. an increase in income (wheat is a normal good)
Ā
d. both a) and b) would lead to long-run entry in perfect competition
Ceteris paribus, if a firm in a perfectly competitive industry raises its price above market price,
Group of answer choices
a. total revenue for the firm will increase.
b. sales will drop to zero.
c.demand curves will become downward sloping.
d. profit will increase.
Chapter 13 Solutions
EBK ESSENTIALS OF ECONOMICS
Ch. 13.1 - Prob. 1QQCh. 13.2 - How does a competitive firm determine its...Ch. 13.3 - Prob. 3QQCh. 13 - Prob. 1QRCh. 13 - Prob. 2QRCh. 13 - Prob. 3QRCh. 13 - Prob. 4QRCh. 13 - Prob. 5QRCh. 13 - Prob. 6QRCh. 13 - Prob. 7QR
Ch. 13 - Prob. 8QRCh. 13 - Prob. 1QCMCCh. 13 - Prob. 2QCMCCh. 13 - Prob. 3QCMCCh. 13 - Prob. 4QCMCCh. 13 - Prob. 5QCMCCh. 13 - Prob. 6QCMCCh. 13 - Prob. 1PACh. 13 - Prob. 2PACh. 13 - Prob. 3PACh. 13 - Prob. 4PACh. 13 - Prob. 5PACh. 13 - Prob. 6PACh. 13 - A firm in a competitive market receives 500 in...Ch. 13 - Prob. 8PACh. 13 - Prob. 9PACh. 13 - Prob. 10PACh. 13 - Prob. 11PACh. 13 - Prob. 12PA
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- Using the graph for the questions : A. There are fixed costs of $50 no matter what the output level is. Fill in the fixed cost column B. Fill in the total costs column C. Fill in the marginal costs column D. This is a perfectly compatible firm . The market price for the output they produce is $40/ unit of output. Fill in the marginal revenue column E. Fill in the total revenue column F. Fill in the profit column G. What is the profit maximizing level of outputarrow_forwardA Perfect Competition has [ Select ] producer(s), products are [ Select ] , it is [Select ] to enter the market, and producers in a perfect competition have [ Select ] control over prices.arrow_forwardConsider a perfectly competitive market that was in a long-run equilibrium when a permanent increase in demand occurs. Which of the following will occur as a result? i. The existing firms will start to earn an economic profit. ii. New firms will be motivated to enter the market. iii. Some firms that cannot meet the new demand will exit the market. A) i and ii only B) ii and ii only C) i and iii D) ii only E) i, ii and iiarrow_forward
- In a kinked demand market, whenever one firm decides to lower its price, Ā A. other firms will automatically follow. Ā B. none of the other firms will follow. Ā C. one half of the firms follow, and one half of the firms don't follow the price cut. Ā D. other firms all decide to exit the industry Ā E. all the other firms raise their prices.arrow_forwardSuppose the equilibrium price of a good in a perfectly competitive market is $15. A firm in the market decides to charge $20 for the good. Which of the following will happen?Ā a. The firm's profit will increase. Ā b. The firm will capture the entire market.Ā Ā c. The firm will not be able to sell any output.Ā Ā d. The firm's revenue will increase.arrow_forwardPlease answer all 1.Ā Coldwater Bicycle Company operates its factories at capacity and holds a dominant market position in its home country. When it receives a premium priced order from a new customer in another country, it must decide whether to fill that order or continue to supply the full demand in its home market. When it decided not to completely fill the new order, it incurred Group of answer choices a. Sunk costs b. Average costs c. Opportunity costs d. Marginal costs Ā 2.Ā What might happen if a car dealership is awarded a bonus by the manufacturer for selling a certain number of its cars monthly, but the dealership is just short of that quota near the end of the month? Group of answer choices a. Potential buyers will lose buying power at the dealer b. It may sell the remaining cars at huge discounts to hit the quota c. It creates an incentive to sell cars from different manufacturers d. It would ruin the relationship between dealer and manufacturerā¦arrow_forward
- Perfect Competition MC - Marginal Cost MR - Marginal Revenue ATC - Average Total Cost Refer to the figure above. If this firm is producing the profit-maximizing quantity and selling it at the profit-maximizing price, the firm'sĀ Ā profitĀ will be: Ā Ā $240 Ā Ā $160 Ā Ā $80 Ā Ā $60arrow_forwardWhich of the following characterizes a perfectly competitive industry? Select one: a. The industry demand curve is vertical. b. Each firm produces a product slightly different from that of its competitors. c. Each firm sets a different price. d. The demand for each individual firm is perfectly elastic.arrow_forwardume the pizza market is a perfectly competitive constant cost industry, and all firms have identical homogenous firms). The market demand and market supply functions for this perfectly competit stry are given below. L 0 1 2 3 4 5 6 7 8 9 q=TP 0 10 20 30 40 50 60 70 80 90 TC 100 205 2.45 280 340 430 545 720 930 1190 P = 30.5-.005Q P = 1.7+.003Q TFC TVC 100 0 100 105 20.50 10.50 100 145 12.25 7.25 100 180 9.33 6.00 100 240 8.50 6.00 100 330 8.60 6.60 100 445 9.08 7.42 100 620 10.29 8.86 100 830 11.63 10.38 100 1090 13.22 12.11 ATC AVC MC 10.50 4.60 3.50 6.00 9.00 11.5 17.50 21.00 26.00arrow_forward
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