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.Management Sciences
Category: Costs , Supply And Perfect Competition
The short run marginal cost curve cuts the short run total cost curve and short run average variable cost curve ?
A. At their lowest points
B. When they are declining
C. When they are increasing
D. When marginal revenue is zero
If a competitive firm doubles its output its total revenue ?
A. doubles.
B. more than double
C. less than doubles.
D. cannot be determined because the price of the good may rise or fall
A grocery store should close at night if the ?
A. variable costs of staying open are less than the total revenue due to staying open.
B. total costs of staying open are less than the total revenue due to staying open
C. variable costs of staying open are greater than the total revenue due to staying open
D. total costs of staying open are greater than the total revenue due to staying open
A competitive firm produces a level of output at which ?
A. Price is greater than marginal cost
B. price equals marginal cost
C. price is less than marginal cost
D. None of the above
In monopolistic competition ?
A. Firms face a perfectly elastic demand curve
B. All products are homogeneous
C. Firms make normal profits in the long run
D. There are barriers to entry to prevent entry
If all firms in a market have identical cost structures and if inputs used in the production of the good in that market are readily available, then the long-run market supply curve for that good should be ?
A. downward sloping
B. perfectly inelastic
C. upward sloping
D. perfectly elastic
In the long-run some firms will exit the market if the price of the good offered for sale is less than ?
A. marginal revenue
B. marginal cost
C. average total cost
D. average revenue
In a competitive industry each buyer and seller ?
A. is a price taker
B. Producer different products
C. Believes that can influence price
D. Prevents the entry of competitors
If the long-run market supply curve for a good is perfectly elastic, an increase in the demand for that good will, in the long run, cause ?
A. an increase in the number of firms in the market but no increase in the price of the good
B. an increase the price of the good and an increase in the number of firms in the market
C. an increase the price of the good but no increase in the number of firms in the market
D. no impact on either the price of the good or the number of firms in the market
In the short run firms in perfect competition will still produce provided ?
A. The price covers average variable cost
B. The price covers variable cost
C. The price covers average fixed cost
D. The price covers fixed costs
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