Figure 6.3 25. Refer to Figure 6.3 for a perfectly competitive firm. If price is
ID: 1117801 • Letter: F
Question
Figure 6.3
25. Refer to Figure 6.3 for a perfectly competitive firm. If price is $6, the profit-maximizing rate of output is:
A) 32 units.
B) 38 units.
C) 43 units.
D) 48 units.
26. Refer to Figure 6.3 for a perfectly competitive firm. If price is $4, the profit-maximizing rate of output is:
A) 43 units.
B) 38 units.
C) 32 units.
D) 25 units.
27. Refer to Figure 6.3 for a perfectly competitive firm. If price is $8, the firm is:
A) Earning an economic profit.
C) Maximizing efficiency.
B) In long run equilibrium.
D) All of the above.
28. Refer to Figure 6.3 for a perfectly competitive firm. If price is $6, the firm is:
A) Earning zero economic profit.
C) Maximizing efficiency.
B) In long run equilibrium.
D) All of the above.
29. Refer to Figure 6.3 for a perfectly competitive firm. If price is $4, the firm is:
A) In long run equilibrium.
C) Maximizing efficiency.
B) Earning an economic loss.
D) Earning an economic profit.
30. Refer to Figure 6.3 for a perfectly competitive firm. If price is $10, the firm is:
A) In long run equilibrium.
C) Maximizing efficiency.
B) Earning an economic loss.
D) Earning an economic profit
ATC 10 532 3 43 4Explanation / Answer
Answer.)
Q25.) B) 38 units.
Perfectly competitive firm achieve its equilibrium price and quantity from the intersection of demand and MC curves. If the price is $6, then the profit-maximizing rate of output will be 38 units.
Q26.) C) 32 units.
Perfectly competitive firm achieve its equilibrium price and quantity from the intersection of demand and MC curves. If the price is $4, then the profit-maximizing rate of output will be 32 units.
Q27.) A) Earning an economic profit.
The Positive difference between price and ATC at the e profit-maximizing rate of output 43 units showing the existence of positive economic profits.
Q28.) D) All of the above.
Q29.) B) Earning an economic loss.
The Negative difference between price and ATC at the e profit-maximizing rate of output 32 units showing the existence of economic loss.
Q30.) D) Earning an economic profit
The Positive difference between price and ATC at the profit-maximizing rate of output 48 units showing the existence of positive economic profits.
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