Question 1

The long-run market supply curve in a competitive market will

Accepted Answer

A)  always be horizontal.
B)  be the portion of the MC that lies above the minimum of AVC for the marginal firm.
C)  typically be more elastic than the short-run supply curve.
D)  be above the competitive firm's efficient scale.E) All of the above
F) B) and C)

Question 2

Figure 14-4
In the following figure, graph (a)  depicts the linear marginal cost (MC)  of a firm in a competitive market, and graph (b)  depicts the linear market supply curve for a market with a fixed number of identical firms.
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-Refer to Figure 14-4. If at a market price of $1.75, 52,500 units of output are supplied to this market, how many identical firms are participating in this market?

Accepted Answer

A)  75
B)  100
C)  250
D)  300E) A) and C)
F) A) and B)

Question 3

Scenario 14-4
A competitive firm sells its output for $20 per unit. When the firm produces 200 units of output, average variable cost is $16, marginal cost is $18, and average total cost is $23.
-Refer to Scenario 14-4. Is the firm maximizing its profit (or minimizing its loss) by producing 200 units of output?

Accepted Answer

No, since ...

Exam 14: Firms in Competitive Markets

The long-run market supply curve in a competitive market will

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No, since ...
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Exam 14: Firms in Competitive Markets

The long-run market supply curve in a competitive market will

Correct AnswerverifiedShow Answer

Correct AnswerverifiedNo, since ...View AnswerShow Answer

Correct AnswerverifiedShow Answer

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No, since ...
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