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Exam 13: Firms in Competitive Markets

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Question 241

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If a firm operating in a competitive industry shuts down in the short run,it can avoid paying

A) fixed costs.
B) variable costs.
C) total costs.
D) The firm must pay all its costs,even if it shuts down.

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Question 242

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Table 13-10 Suppose that a firm in a competitive market faces the following revenues and costs: -Refer to Table 13-10.If the firm produces the profit-maximizing level of production,how much profit will the firm earn?

A) $2
B) $4
C) $6
D) $8

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Question 243

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Table 13-3 -Refer to Table 13-3.For a firm operating in a competitive market,the marginal revenue is

Figure 13-6 Suppose a firm operating in a competitive market has the following cost curves: -Refer to Figure 13-6.When market price is P3,a profit-maximizing firm's total revenue

Describe the difference between average revenue and marginal revenue.Why are both of these revenue measures important to a profit-maximizing firm?

A firm that exits its market has to pay

Table 13-13 Diana's Dress Emporium -Refer to Table 13-13.What is Diana's economic profit at the profit maximizing point?

For a certain firm,the 100th unit of output that the firm produces has a marginal revenue of $10 and a marginal cost of $7.It follows that the

Scenario 13-5 A study sponsored by the Food Consumer Safety Board found that consumption of irradiated tomatoes increased the health of laboratory rats.As a result of national press coverage of the report,the demand for irradiated tomatoes increased dramatically.Organic farmers were able to switch from organic production of tomatoes to irradiated production with no additional cost.Assume that the tomato market satisfies all of the assumptions of perfect competition. -Refer to Scenario 13-5.As a result of the increase in the demand for tomatoes,we would predict that in the short run that the

The long-run supply curve for a competitive industry may be upward sloping if

Figure 13-7 Suppose a firm operating in a competitive market has the following cost curves: -Refer to Figure 13-7.Which segment of the supply curve represents the firm shutting down?

Table 13-6 The following table presents cost and revenue information for a firm operating in a competitive industry. -Refer to Table 13-6.What is the total revenue from selling 7 units?

In a competitive market,no single producer can influence the market price because

Table 13-8 Suppose that a firm in a competitive market faces the following revenues and costs: -Refer to Table 13-8.The firm will produce a quantity greater than 4 because at 4 units of output,marginal cost

Table 13-12 Bill's Birdhouses -Refer to Table 13-12.What is the average revenue when 4 units are sold?

Figure 13-2 Suppose a firm operating in a competitive market has the following cost curves: -Refer to Figure 13-2.Which of the four prices corresponds to a firm earning zero economic profits in the short run?

Scenario 13-3 Suppose a certain competitive firm is producing Q=500 units of output.The marginal cost of the 500th unit is $17,and the average total cost of producing 500 units is $12.The firm sells its output for $20. -Refer to Scenario 13-3.At Q=500,the firm's profits equal

Table 13-5 -Refer to Table 13-5.The price of the product is

When a resource used in the production of a good sold in a competitive market is available in only limited quantities,the long-run supply curve is likely to be upward sloping.