Microeconomics
Microeconomics
13th Edition
ISBN: 9781337617406
Author: Roger A. Arnold
Publisher: Cengage Learning
Question
Chapter 9, Problem 6WNG

(a)

To determine

Graphical illustration of a perfectly competitive firm that earns a profit. 

(b)

To determine

Graphical illustration of a perfectly competitive firm that incurs losses but that will continue operating in the short run.

(c)

To determine

Graphical illustration of a perfectly competitive firm that incurs losses but that will shut down in the short run.

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Students have asked these similar questions
A perfectly competitive firm is currently maximizing profits. The market for its product is in a long-run equilibrium. Market demand for the product decreases. Summarize what will happen in the market in the long run. Discuss the changes that will occur in the long run for the firm and explain why. You do not need to discuss why each cost changes, but do explain why the firm ends up where it does relative to where it was at the beginning and where it was in the short run.
A requirement for a perfectly competitive market is that the sellers sell identical products (consumers don't care who makes the products sold in that market). Think about this from the perspective of the seller. What are the benefits of this? What are the drawbacks?
Question 4 List the four characteristics of a perfectly competitive industry and give one example of an industry that is perfectly (or close to perfectly) competitive.
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