wederocou sejd 1405086-1 : &content; id= 33209391 18 ste Question Completion Sta
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wederocou sejd 1405086-1 : &content; id= 33209391 18 ste Question Completion Status: QUESTION 17 4 poin In exiting decisions, a perfectly competitive firm compares the O price with marginal cost. O price with average fixed cost O price with average variable cost. price with average total cost QUESTION 18 4 points Tom produces commemorative t-shirts in a competitive market. If Tom decides to decrease his output, this will o a decrease his revenue, since the price does not rise sufficiently when output drops to offset the drop in Tom's output. O b. increase his revenue, since the output decrease leads to a higher market price Oc decreasehis revenue, since his output has decreaseod and the price remains the same. O d increase his revenue, since Tom's competitors will also decrease their output, so that price rises to offiet the drop in Tom's output 4pointss QUESTION 19 Table The table below shows the price and cost information for i fitmi that competitive market s in a perfectly COMPUTER HELPExplanation / Answer
17) Price with average variable cost
When the price is below average variable cost, a firm shuts down as firm is incurring loss and not even able to cover variable cost. It exits.
18) c is correct
A perfect competitive firm is a price taker and had no control over prices. Hence with decrease in output price remains the same. Total revenue falls.
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