C. the entrepreneur dete D. individual consumers determine market prices. 2. 25.

Question

C. the entrepreneur dete D. individual consumers determine market prices. 2. 25. In a perfectly competitive market, the demand curve faced by an individual firm is: A. perfectly inelastic. B. relatively inelastic. C. perfectly elastic. D. relatively elastic. 3. 28. The demand curve for a firm in perfect competition is equal to its: A. marginal cost curve. B marginal revenue curve. average total cost curve. D. average fixed cost curve. 2. As long as marginal cost is below marginal revenue, a perfectly competitive firm should ncrease production B. hold production constant. C. decrease production. D. reconsider past production decisions. 5. 33. The profit-maximizing condition for a perfectly competitive firm is: A. MR B. MR AVC. P MC, D. AVC. 6. 34. To maximize profits, a perfectly competitive firm should produce where marginal: A. marginal cost equals total revenue. B. marginal cost exceeds marginal revenue. C. marginal cost equals marginal revenue. D. marginal revenue exceeds marginal cost. 7. 91. A perfectly competitive firm in the long run: A. can earn positive or negative economic profits. B. can earn negative accounting profits as long as economic profits are positive. C. makes zero economic profits. D. makes zero accounting profits.

Explanation / Answer

ans 2

c) perfectly elastic

ans 6

c) marginal cost equals marginal revenue

ans 7

makes zero economic profits

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