Economists group industries into ______ distinct market structures. Show
four Pure ______ involves a very large number of firms. competition Number of firms in pure competition a very large number number of firms in monopolistic competition many/relatively large number number of firms in oligopoly few number of firms in monopoly one True or false: A pure monopoly involves a very large number of firms producing a single unique product.f false Which of the following is a characteristic of a monopolistically competitive market? Firms not having any control over the selling price of goods High barriers to entry and exit A perfectly elastic demand curve A relatively large number of sellers producing differentiated products A relatively large number of sellers producing differentiated products Which of the following best describes oligopoly? Involves only a few sellers of an identical product, so each firm is affected by the decisions of its rivals. Involves only a few sellers of a standardized or differentiated product, so each firm is unaffected by the decisions of its rivals. Involves many sellers of a standardized or differentiated product, so each firm is affected by the decisions of its rivals. Involves only a few sellers of a standardized or differentiated product, so each firm is affected by the decisions of its rivals. Involves only a few sellers of a standardized or differentiated product, so each firm is affected by the decisions of its rivals. Which of the following best describes pure competition? An industry involving one large firm producing many products and in which new firms cannot enter or exit the industry very easily. An industry involving a few firms producing identical products and in which new firms cannot enter or exit the industry very easily. An industry involving a very large number of firms producing identical products and in which new firms can enter or exit the industry very easily. An industry involving two firms producing identical products and in which new firms can enter or exit the industry very easily. An industry involving a very large number of firms producing identical products and in which new firms can enter or exit the industry very easily. A purely competitive industry has a very ______ number of sellers, whereas the other three market structures reflect a progressively ______ or ______ number of sellers. small; smaller;
decreasing large; smaller; decreasing _____ competition is considered to be rare in the real world. pure Which of the following best describes a pure monopoly? One firm selling a single unique product, with ease of entry into the industry and little control over price One firm selling a single unique product, where entry of additional firms is blocked and there is considerable control over price Many firms selling a single unique product, where entry of additional firms is blocked and there is considerable control over price One firm selling differentiated products or services and in which entry of additional firms is blocked One firm selling a single unique product, where entry of additional firms is blocked and there is considerable control over price Which of the following are conditions necessary to have pure competition? barriers to entry free entry and
exit In which market model do firms rely on product differentiation to distinguish themselves from the competition? pure competition monopolistic competition An oligopoly has ___ sellers and must consider the decisions of its rivals in determining its own ___ and output. few; price Which of the following features occur in a purely competitive market? One seller dominating the market Sales in both national
and international markets. Which of the following market structures produces only a standardized product? A purely competitive market Which of the following best summarizes why firms in purely competitive industries do not differentiate their products? Because there is not enough demand for differentiated products Because there are so many of them selling a standardized product Because there are so many of them selling a non-standardized product Because of scarce resources that limit the production of alternative products Because there are so many of them selling a standardized product Firms within pure competition are considered to be price _______ takers A firm operating in a purely competitive market is a price taker because it ______. cannot change the market price in the long run cannot change the market price, it can only adjust to it Which of the following is a characteristic of a monopolistically competitive market? Firms not having any control over the selling price of goods High barriers to entry and exit A relatively large number of sellers producing differentiated products A perfectly elastic demand curve A relatively large number of sellers producing differentiated products A purely competitive firm is a price _______ taker A basic feature of the purely competitive market is the presence of ______. a large number of sellers a large number of sellers In a perfectly competitive market, the demand curve for an individual firm is perfectly _______ at the market price. elastic True or false: Firms within pure competition will produce standardized products. true In a purely competitive market, price per unit to the purchaser is synonymous with _______ per unit or ________ revenue to a seller. (Enter one word per blank.) 1. revenue Firms that operate in a purely competitive industry: never incur short-run profits do not differentiate their products
The price, multiplied by the firm's output or goods produced, equals ______. marginal revenue total revenue Which of the following best describes the situation of a price-taking firm? large; a large share large; only a fraction Reason: Which of the following explains why a purely competitive firm is a price taker? A purely competitive firm produces all of total market supply and therefore must accept the price determined by the market A purely competitive firm offers only a negligible fraction of total market supply and therefore must set the price for the market A purely competitive firm offers a large fraction of total market supply and therefore determines market price A purely competitive firm offers only a negligible fraction of total market supply and therefore must accept the price determined by the market A purely competitive firm offers only a negligible fraction of total market supply and therefore must accept the price determined by the market The change in total revenue that results from selling one more unit of output is called _____ revenue. marginal Which factors illustrate that the demand curve for a purely competitive firm is
perfectly elastic? The firm cannot obtain a higher price by restricting its output. The firm produces only a small fraction of the total industry output. The firm does not need to lower its price to increase its sales volume. The firm has no legal or financial barriers for entering or exiting the industry. The firm cannot obtain a higher price by restricting its output. The firm does not need to lower its price to increase its sales volume. In a purely competitive market, marginal revenue is a constant that is equal to which of the following? quantity price In a purely competitive market, price per unit to a buyer equals: average profits to a
seller average revenue to a seller A(n) _______ competitive firm's average-revenue schedule is also known as its demand schedule. pure A firm's total revenue is calculated as ______ times quantity produced. (Enter one word in the blank) price A purely competitive firm can maximize its economic profit (or minimize its loss) by adjusting only its output because it ______. has access to unlimited resources is a price taker A firm operating in a purely competitive
market is a price taker because it ______. can change the market price in the long run cannot change the market price, it can only adjust to it cannot change the market price in the long run can change the market price in the short run cannot change the market price, it can only adjust to it What are two ways that a purely competitive firm can determine the
level of output at which it will realize maximum profit or minimum losses? By comparing marginal costs to total costs By comparing marginal revenue to marginal costs In pure competition, if the
first unit of output sold increases total revenue from $0 to $131, marginal revenue for that unit is $131. If the second unit sold increases total revenue from $131 to $262, marginal revenue is again $131. The third unit sold increases total revenue to $______ and marginal revenue is now $______. 131; 393 393; 131 Confronted with the market
price of its product, a purely competitive producer will ask which three questions? If we sell above market price what will our profits be? What economic profit or loss will we realize if we produce this product? If we produce this product, in what amount? If we produce this product, what price should we charge? Should we produce this product? What economic profit or loss will we realize if we produce this product? If we produce this product, in what amount? Should we produce this product? In pure competition, marginal revenue and ______ are equal. price From an economic standpoint, the break-even point is the level of output at which a firm makes a(n) ______ profit. normal normal A purely competitive firm's demand schedule is equal to which of the following? quantity supplied marginal revenue In the short run, a purely competitive firm can maximize its economic profit (or minimize its loss) by adjusting its ______ output ______ revenue is the additional revenue that an additional unit of _______ would add to total revenue marginal, output The two ways to determine the level of output at which a firm will realize maximum profit or minimum loss are to compare total revenue to ______ and to compare marginal revenue to
______. marginal cost; total cost total cost; marginal cost A firm would not produce a unit of output where ______. marginal cost exceeds average revenue marginal cost exceeds marginal revenue After a company has determined that it should produce a product and the amount of the product to produce, what basic question should it ask? Which sales promotions should we offer? What economic profit (or loss) will we realize? A firm should not produce a unit of output when the marginal cost is (greater/lesser) than its marginal revenue. greater Which of the following best describes the economic break-even point? The point where total revenue exceeds total costs and economic profits are realized. The point where total revenue covers fixed costs but not variable costs. The point where total revenues exceed those of the strongest competitor in the industry. The point where total revenue covers all costs, but there is no economic profit. The point where total revenue covers all costs, but there is no economic profit. In a purely
competitive industry, at the profit-maximizing or loss-minimizing level of output, marginal ______ is equal to ______. output; marginal cost revenue; marginal cost A(n) ______ competitive firm's average-revenue schedule is also known as its demand schedule. pure In pure competition, to calculate economic profit, we first calculate the difference between _______ and average total cost and then multiply it by output. (Type only one word in blank.) price Which of the following best describes marginal revenue? The sum of revenue received by producing at a certain level of output The cost that an additional unit of output contributes to total cost The level of output needed to produce revenue that covers all of the firm's costs The revenue that an additional unit of output contributes to total revenue The revenue that an additional unit of output contributes to total revenue This graph illustrates that a firm can minimize its losses by producing where ______. price exceeds minimum average variable cost but is less than marginal cost price exceeds minimum average variable cost but is less than average total cost price exceeds minimum average total cost but is less than average fixed cost price equals minimum average variable cost but is less than minimum average total cost price exceeds minimum average variable cost but is less than average total cost Which
of the following explains why a firm would not produce a unit of output where MC exceeds MR? Producing it would add more to revenue than to costs, and profit would decline or loss would increase. Producing it would add more to revenue than to costs, and profit would increase or loss would decrease. Producing it would add more to costs than to revenue, and profit would decline or loss would increase. Producing it would add more to costs than to revenue, and profit would increase or loss would decrease. Producing it would add more to costs than to revenue, and profit would decline or loss would increase. Which of the following improves as production increases? Price-marginal revenue relationship Price-marginal
cost relationship When the marginal cost of an additional unit of output exceeds the marginal revenue, what should the firm do? Reduce its fixed plant size Not produce that additional unit of output The MR = MC rule is known as the: profit maximizing rule Which of the following is a method of calculating economic profit in pure competition? Price minus average variable cost multiplied by quantity Price minus average total cost plus quantity Price minus average total cost multiplied by quantity Price minus average total cost multiplied by quantity The quantity of a product supplied by a firm in pure competition should _____ as long as price rises. remain constant increase Which of the following best explains why the price-marginal cost relationship improves as production increases? At the very early stages of production, marginal product is high, making marginal cost unusually high. At the very late stages of production, marginal product is low, making marginal cost unusually high. At the very early stages of production, marginal revenue is low, making marginal cost unusually high. At the very early stages of production, marginal product is low, making marginal cost unusually high. At the very early stages of production, marginal product is low, making marginal cost unusually high. If price is below a firm's minimum average _______ cost, the firm will not operate. (Insert only one word in the blank.) variable A firm should always stop producing if its average ______ cost is ______ price. variable; greater than variable; greater than At which point will a firm be indifferent whether to shut down or continue to produce? Recall that a firm will be indifferent to shutting down or producing when price is equal to minimum average variable cost. The profit-maximizing rule of MR=MC states that in the short run, the firm will maximize profit or minimize loss by producing the output for which marginal revenue ______ marginal cost. is less than equals
In pure competition, to calculate economic profit, we first calculate the difference between _______ and average total cost and then multiply it by output. (Type only one word in blank.) price (pure compeition) ... True or false: Quantity supplied increases as price decreases, and economic profit is usually higher at lower product prices and output. false What is the firm's most likely response if price is exactly equal to minimum average variable cost? Indifference to producing or shutting down Indifference to producing or shutting down Which of the following is a method of calculating economic profit in pure competition? Total revenue minus marginal cost divided by quantity Price minus average variable cost multiplied by quantity Price minus average total cost multiplied by quantity Price minus average total cost plus quantity Price minus average total cost multiplied by quantity Changes in _______ (Enter one word) and changes in prices of variable inputs alter costs and shift the marginal cost or short run supply curve. technology A firm will break even where ______ will just cover ______ because the revenue per unit and the average total cost per unit are equal. marginal cost; marginal
revenue total revenue; total cost Multiplying product price by output reveals which of the following? Quantity demanded Total revenue When
will a firm earn an economic profit? When price is less than average total price. When price is greater than average total cost. Which of the following reasons explains why the purely competitive firm's demand curve is perfectly
elastic? Because the individual firm is a price taker, the marginal revenue curve coincides with the firm's equilibrium price. Because the individual firm is a price maker, the total revenue curve coincides with the firm's equilibrium price. Because the individual firm is a price maker, the marginal revenue curve coincides with the firm's equilibrium price. Because the individual firm is a price taker, the marginal cost curve coincides with the firm's equilibrium price. Because the individual firm is a price taker, the marginal revenue curve coincides with the firm's equilibrium price. Which of the following factors will alter costs and shift the marginal cost or short-run supply curve to a new location? Consumer preferences Prices of variable inputs Total revenue equals ______ times ______. demand; quantity price; quantity Each purely competitive firm's demand curve is perfectly _______ at the equilibrium price. elastic (horizontal, flat) Local electric or gas utility companies mostly operate in which market structure? pure monopoly Which market model assumes the least number of firms in an industry? pure monopoly In which market model would there be a unique product for which there are no close substitutes? pure monopoly Which of the following is true under conditions of pure competition? There are differentiated products. The market demand curve is perfectly elastic. No single firm can influence the market price by changing its production level. Each individual firm has the ability to set its own price. No single firm can influence the market price by changing its production level. If a firm is a price taker, then the demand curve for the firm's product is equal to the total revenue curve. perfectly elastic Which of the following is not a necessary characteristic of a purely competitive
industry? The industry or market demand is highly elastic. Firms can easily enter or leave the industry. There are so many small firms that no one firm can influence the market price. Consumers see no difference between the product of one firm and that of another. The industry or market demand is highly elastic. In the short run, fixed costs for a profitable competitive
firm are zero. irrelevant in determining the optimal level of output. When a firm is maximizing profit, it will necessarily be maximizing profit per unit of output. maximizing the difference between total revenue and total cost. minimizing total cost .maximizing total revenue. maximizing the difference between total revenue and total cost. Technological advance improves productivity in a purely competitive industry. This change will result in a shift down of the individual firm's MC curve, causing the market supply curve to shift to the left. down of the individual firm's MC curve, causing the market supply curve to shift to the right. up of the individual firm's MC curve, causing the market supply curve to shift to the left. up of the individual firm's MC curve, causing the market supply curve to shift to the right. down of the individual firm's MC curve, causing the market supply curve to shift to the right. Which of the following explains why a perfectly competitive firm is a price taker?A perfectly competitive firm is known as a price taker because the pressure of competing firms forces them to accept the prevailing equilibrium price in the market. If a firm in a perfectly competitive market raises the price of its product by so much as a penny, it will lose all of its sales to competitors.
Why is a perfectly competitive firm called a price taker quizlet?A perfectly competitive firm is a price taker because: It has no control over the market price of its product.
Which of the following accurately explains why firms in perfectly competitive markets are price takers quizlet?Which of the following accurately explains why firms in perfectly competitive markets are price takers? the pressure of competition forces all firms to accept the prevailing equilibrium price in the market.
Which of the following is correct a purely competitive firm is a price maker?The correct answer is b) A purely competitive firm is a "price-taker" and a monopolistic firm is a "price-maker".
|
Which of the following explains why a purely competitive firm is a price taker quizlet?
zusammenhängende Posts
Urheberrechte © © 2024 WIKIFI Inc.
