20.Which of the following statements is correct?A.The demand curve for a purely competitive firm is perfectly elastic, but thedemand curve for a purely competitive industry is downsloping.B.The demand curve for a purely competitive firm is downsloping, but the demand curvefor a purely competitive industry is perfectly elastic.C.The demand curves are downsloping for both a purely competitive firm and a purelycompetitive industry.D.The demand curves are perfectly elastic for both a purely competitive firm and apurely competitive industry. Show 21.Assume a firm close down in the short run and produces no output. Under theseconditions: Get answer to your question and much more
22.The short-run average total cost curve is U-shaped because: Get answer to your question and much more The diagram shows the short-run average total cost curves for five different plant sizes of afirm. 23. As the firm in the diagram expands from plant size #1 to plant size #3, it experiences: Get answer to your question and much more 24. Refer to the diagram above. If in the long run the firm should produce output 0x, it shoulddo it with a plant of size:A.#4.B.#3.C.#2.D.#1. 25.A competitive firm in the short run can determine the profit-maximizing (or loss-minimizing) output by equating: Get answer to your question and much more 26. Which of the following is not a source of economies of scale? Get answer to your question and much more 27. Diseconomies of scale arise primarily because: Get answer to your question and much more D.beyond some point marginal product declines as additional units of a variable resource(labor) are added to a fixed resource (capital).28.If a firm increases all of its inputs by 10 percent and its output increases by 10 percent,then:A.it is encountering diseconomies of scale.B.it is encountering economies of scale.C.it is encountering constant returns to scale.D.the marginal products of all inputs are falling. 29. Curves (1), (2), (3), and (4) in the diagram are a purely competitive firm's: Get answer to your question and much more 30.A firm reaches a break-even point (normal profit position) where: Get answer to your question and much more 31.Suppose you find that the price of your product is less than minimum AVC. Youshould: Get answer to your question and much more End of preview. Want to read all 19 pages? Upload your study docs or become a Course Hero member to access this document Tags Economics of production, Average cost Chapter 09 - Pure Competition23. A purely competitive seller's average revenue curve coincides with: Get answer to your question and much more 24. Marginal revenue is the:A. change in product price associated with the sale of one more unit of output.B. change in average revenue associated with the sale of one more unit of output.C. difference between product price and average total cost.D. change in total revenue associated with the sale of one more unit of output. 25. Marginal revenue for a purely competitive firm: Get answer to your question and much more 26. Firms seek to maximize: Get answer to your question and much more 27.A competitive firm in the short run can determine the profit-maximizing (or loss-minimizing) output by equating: Get answer to your question and much more 28. In the short run a purely competitive firm that seeks to maximize profit will produce:A. where the demand and the ATC curves intersect.B. where total revenue exceeds total cost by the maximum amount.C. that output where economic profits are zero.D. at any point where the total revenue and total cost curves intersect. What is the demand curve in a purely competitive industry?A perfectly competitive firm's demand curve is a horizontal line at the market price. This result means that the price it receives is the same for every unit sold.
Which of the following statements is correct about the demand curve of the perfectly competitive industry?The correct option is D. The market demand curve of the perfectly competitive industry is downward-sloping while the demand curve facing an individual firm is horizontal.
Which of the following statements is correct purely competitive?The correct answer is b) A purely competitive firm is a "price-taker" and a monopolistic firm is a "price-maker". A single competitive firm can't influence the market decision as it plays a very small role in the market. A competitive market has a large number of small firms operating in the market.
Is the demand curve for a purely competitive firm elastic?All goods in a perfectly competitive market are considered perfect substitutes, and the demand curve is perfectly elastic for each of the small, individual firms that participate in the market. These firms are price takers–if one firm tries to raise its price, there would be no demand for that firm's product.
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Which of the following statements is correct the demand curve for a purely competitive?
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