Why Competitive Industry Charge the Market Price
Order ID 53563633773 Type Essay Writer Level Masters Style APA Sources/References 4 Perfect Number of Pages to Order 5-10 Pages Description/Paper Instructions
Why Competitive Industry Charge the Market Price
- Why does a firm in a competitive industry charge the market price?
- If a firm charge less than the market price, it loses potential revenue.
- If a firm charges more than the market price, it loses all its customers to other firms.
- The firm can sell as many units of output as it want to at the market price.
- All of the above are correct.
- If a competitive firm is currently producing a level of output at which marginal cost exceeds marginal revenue, then
- average revenue exceeds marginal cost.
- the firm is earning a positive profit.
- decreasing output would increase the firm’s profit.
- All of the above are correct.
- A firm will shut down in the short run if, for all positive levels of output
- its loss exceeds its fixed costs.
- its total revenue is less than its variable costs.
- the price of its product is less than its average variable cost.
- All of the above are correct.
- A firm that exits its market has to pay
- its variable costs but not its fixed costs.
- its fixed costs but not its variable costs.
- both its variable costs and its fixed costs.
- neither its variable costs nor its fixed costs.
- Which of the following statements is not correct?
- In a long-run equilibrium, marginal firms make zero economic profit.
- To maximize profit, firms should produce at a level of output where price equals average variable cost.
- The amount of gold in the world is limited. Therefore, the gold jewelry market probably has a long-run supply curve that is upward sloping.
- Long-run supply curves are typically more elastic than short-run supply curves.