Filters
Question type
Study Flashcards

-Giuseppe's Pizza is a perfectly competitive firm. The firm's costs are shown in the table above. If the market price is $15, the firm will A) shut down. B) leave the market in the long run. C) stay in the market in the long run. D) make an economic profit. -Giuseppe's Pizza is a perfectly competitive firm. The firm's costs are shown in the table above. If the market price is $15, the firm will


A) shut down.
B) leave the market in the long run.
C) stay in the market in the long run.
D) make an economic profit.

E) None of the above
F) B) and C)

Correct Answer

verifed

verified

In a perfectly competitive market that is in long-run equilibrium, a permanent leftward shift in the market demand curve


A) raises the price in the short run.
B) raises profits in the short run.
C) leads to firms leaving the market in the long run.
D) raises the price at first but then returns it to its original level in the long run.

E) A) and D)
F) A) and C)

Correct Answer

verifed

verified

When do new firms enter a perfectly competitive market? When does entry stop?

Correct Answer

verifed

verified

New firms enter a perfectly competitive ...

View Answer

-Acme is a perfectly competitive firm. It has the cost schedules given in the above table and has a fixed cost of $12.00. The price of Acme's product is $14.20. What is Acme's most profitable amount of output? What is Acme's total economic profit or loss? -Acme is a perfectly competitive firm. It has the cost schedules given in the above table and has a fixed cost of $12.00. The price of Acme's product is $14.20. What is Acme's most profitable amount of output? What is Acme's total economic profit or loss?

Correct Answer

verifed

verified

The profit maximizing level of output is...

View Answer

Fresno County, California is the largest agricultural producing county in the country and almonds are an important crop with more than 99,000 acres harvested. Each acre produces about a ton of almonds and sold at a price of $4300 a ton. The Sagardia Brothers grew 600 acres of almonds. What would happen if the Sagardia Brothers priced their almonds at $4500 a ton?


A) Profits will be higher than when they sell them at the lower price.
B) The quantity sold will be higher.
C) They will not sell any almonds.
D) They will sell fewer almonds, but profits will be higher.

E) A) and C)
F) B) and C)

Correct Answer

verifed

verified

As perfectly competitive firms leave a market because they are incurring an economic loss, the price of the good ________ and the economic loss of each remaining firm ________.


A) rises; increases
B) rises; decreases
C) falls; increases
D) falls; decreases

E) A) and B)
F) A) and C)

Correct Answer

verifed

verified

-Given the total cost and total revenue curves in the above figure, what are the output levels at which the perfect competitor will incur economic losses? A) below 80,000 bushels B) from 30,000 to 80,000 bushels C) below 30,000 bushels and over 80,000 bushels D) at 30,000 bushels and at 80,000 bushels -Given the total cost and total revenue curves in the above figure, what are the output levels at which the perfect competitor will incur economic losses?


A) below 80,000 bushels
B) from 30,000 to 80,000 bushels
C) below 30,000 bushels and over 80,000 bushels
D) at 30,000 bushels and at 80,000 bushels

E) B) and C)
F) A) and C)

Correct Answer

verifed

verified

-Fast Copy is a perfectly competitive firm. The figure above shows Fast Copy's cost curves. If the market price is 2 cents per page, what is Fast Copy's profit maximizing level of output? A) 16 pages per hour B) 32 pages per hour C) 48 pages per hour D) 64 pages per hour -Fast Copy is a perfectly competitive firm. The figure above shows Fast Copy's cost curves. If the market price is 2 cents per page, what is Fast Copy's profit maximizing level of output?


A) 16 pages per hour
B) 32 pages per hour
C) 48 pages per hour
D) 64 pages per hour

E) A) and B)
F) A) and D)

Correct Answer

verifed

verified

How does a decrease in the demand for wheat ultimately lead to normal profits for wheat growers in the long run?

Correct Answer

verifed

verified

If the demand for wheat decreases, the p...

View Answer

In the long run, a perfectly competitive firm makes zero economic profit. What incentive does the firm have to stay in business if it is making zero economic profit?

Correct Answer

verifed

verified

Zero economic profits do not mean no pro...

View Answer

In the long run, the economic profit of a firm in a perfectly competitive market


A) will be above zero.
B) will be below zero.
C) will equal zero.
D) can be above, below, or equal to zero.

E) All of the above
F) A) and D)

Correct Answer

verifed

verified

-The figure above shows a typical perfectly competitive corn farm, whose marginal cost curve is MC and average total cost curve is ATC. Assuming there are no changes in technology, in the long run the lowest possible price for corn is ________ per bushel. A) $2.50 B) $2.00 C) $3.00 D) $3.50 -The figure above shows a typical perfectly competitive corn farm, whose marginal cost curve is MC and average total cost curve is ATC. Assuming there are no changes in technology, in the long run the lowest possible price for corn is ________ per bushel.


A) $2.50
B) $2.00
C) $3.00
D) $3.50

E) B) and C)
F) A) and C)

Correct Answer

verifed

verified

If the price of its product falls below the minimum point on the AVC curve, the best a perfectly competitive firm can do is to


A) keep producing and incur an economic loss equal to its total variable cost.
B) keep producing and incur an economic loss equal to its total fixed cost.
C) shut down and incur an economic loss equal to its total variable cost.
D) shut down and incur an economic loss equal to its total fixed cost.

E) None of the above
F) All of the above

Correct Answer

verifed

verified

-Sue's Sea Shells by the Sea Shore is a perfectly competitive firm selling sea shells at the market price of $2 per dozen. Sue's Sea Shells by the Sea Shore has fixed costs of $40 per day and a variable cost schedule in the table above. Based on this information, we can expect the number of firms in the sea shell market to A) decrease. B) increase. C) remain constant. D) It is impossible to say. -Sue's Sea Shells by the Sea Shore is a perfectly competitive firm selling sea shells at the market price of $2 per dozen. Sue's Sea Shells by the Sea Shore has fixed costs of $40 per day and a variable cost schedule in the table above. Based on this information, we can expect the number of firms in the sea shell market to


A) decrease.
B) increase.
C) remain constant.
D) It is impossible to say.

E) A) and D)
F) C) and D)

Correct Answer

verifed

verified

Which of the following is a defining characteristic of a perfectly competitive market?


A) advertisements by well-known celebrities
B) persistent economic profits in the long run
C) no restrictions on entry into the industry
D) higher prices being charged for certain name brands

E) B) and C)
F) A) and C)

Correct Answer

verifed

verified

The market for maple syrup is perfectly competitive. Suppose that the market is in long-run equilibrium when the market demand for maple syrup increases. After the demand increases, a typical firm will


A) make zero economic profit.
B) make an economic profit.
C) incur an economic loss.
D) exit the market.

E) A) and B)
F) A) and C)

Correct Answer

verifed

verified

Entry of new firms into a perfectly competitive market raises the product's price.

A) True
B) False

Correct Answer

verifed

verified

When Sidney's Sweaters, Inc. makes exactly zero economic profit, Sidney, the owner,


A) is taking a loss.
B) will shut down in the short run.
C) makes an income equal to his best alternative forgone income.
D) will boost output.

E) All of the above
F) A) and D)

Correct Answer

verifed

verified

A perfectly competitive firm is producing at the point where its marginal cost equals its marginal revenue. If the firm boosts its output, its total revenue will ________ and its profit will ________.


A) rise; rise
B) rise; fall
C) fall; rise
D) fall; fall

E) A) and B)
F) None of the above

Correct Answer

verifed

verified

A perfectly competitive firm maximizes its profit by producing the output at which its marginal cost equals its


A) marginal revenue.
B) average total cost.
C) average variable cost.
D) average fixed cost.

E) A) and B)
F) None of the above

Correct Answer

verifed

verified

Showing 121 - 140 of 487

Related Exams

Exam 1

What Is Economics

479 Questions

Exam 2

The Economic Problem

439 Questions

Exam 3

Demand and Supply

515 Questions

Exam 4

Elasticity

533 Questions

Exam 5

Efficiency and Equity

449 Questions

Exam 6

Government Actions in Markets

410 Questions

Exam 7

Global Markets in Action

200 Questions

Exam 8

Utility and Demand

364 Questions

Exam 9

Possibilities, Preferences, and Choices

464 Questions

Exam 10

Organizing Production

385 Questions

Exam 11

Output and Costs

494 Questions

Exam 13

Monopoly

606 Questions

Exam 14

Monopolistic Competition

320 Questions

Exam 15

Oligopoly

280 Questions

Exam 16

Public Choices and Public Goods

356 Questions

Exam 17

Externalities and the Environment

284 Questions

Exam 18

Markets for Factors of Production

382 Questions

Exam 19

Economic Inequality

354 Questions

Exam 20

Uncertainty and Information

233 Questions

Exam 21

Extension A: Review

11 Questions

Exam 22

Extension B: Review

25 Questions

Exam 23

Extension C: Review

14 Questions

Exam 24

Extension D: Review

38 Questions

Exam 25

Extension E: Review

11 Questions

Exam 26

Extension F: Review

18 Questions

Show Answer