9. Which of the following industries is most likely to exhibit the characteristi
ID: 1115501 • Letter: 9
Question
9. Which of the following industries is most likely to exhibit the characteristic of free entry? a. Nuclear power b. Municipal water and sewer c. Dairy farming d. Airport Security 10. Which of the following statements best reflects a price-taking firm? a. If the firm were to charge more than the going price, it would sell none of its goods. The firm has an incentive to charge less than the market price to earn higher revenue The firm can sell only a limited amount of output at the market price before the market price will fall. Price-taking firms maximize profits by chagrining a price above marginal cost. b. c. d. 11. Which of the following statements regarding a competitive market is not correct? a. b. c. d. There are many buyers and many sellers in the market. Firms can freely enter or exit the market. Price equals average revenue. Price exceeds marginal revenue. 12. Suppose a firm in a competitive market earned $1,000 in total revenue and had a marginal revenue of S10 for the last unit produced and sold. What is the average revenue per unit, and how many units were sold? a. $5 and 50 units b. $5 and 100 units c. $10 and 50 units d. $10 and 100 unitsExplanation / Answer
Q9
Option c
The dairy farming has the lowest barrier to entry and other have large barrier to entry
Q10
Option a
the firm does not have the power to sell anything above market price is a competitive market firm
Q11
Answer
option d
the price and marginal revenue are same and constant for the perfectly competitive firm because the firm is the price taker and the demand curve is horizontal whereas the marginal curve is inside of it.
Q12
Answer
Option d
in the perfecly competitive firm
P=AR=MR=10
so
Quantity=TR/P=1000/10=100
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