1. In a perfectly competitive market, ________. there are barriers that make it
ID: 2813634 • Letter: 1
Question
1. In a perfectly competitive market, ________.
there are barriers that make it difficult for firms to enter
no one seller can influence the price of the product
prices are falling at every level of output
average revenue exceeds marginal revenue for each unit sold
2. Which of the following characteristics does NOT apply to perfectly competitive markets?
Companies can enter and exit the market easily.
Sellers in the market are price-takers.
The number of buyers and sellers is small.
Buyers and sellers have complete information about the identical products of all competing companies.
3. Marginal cost is ________.
a change in total costs from a single-unit change in quantity
a change in total revenue from a single-unit change in quantity
a change in total costs from a multiple-unit change in quantity
a change in total revenue from a multiple-unit change in quantity
4. When a manager chooses to produce a quantity where marginal revenue exceeds marginal cost, ________.
the company is losing money
the company's marginal revenue is falling
the company is not earning all the profit that it can
the company is earning all the profit that it can
Explanation / Answer
1. no one seller can influence the price of the product: In perfectly competitive market, the sellers are price takers so they cannot influence the price. the price is arrived by the entire market's demand-supply mix
2. The number of buyers and sellers is small.: the number of buyers and sellers are larger in perfectly competitive market
3. change in total costs from a single-unit change in quantity: marginal cost means the cost incurred for producing 1 additional unit of output
4. the company is earning all the profit that it can: when marginal revenue exceeds the marginal cost, it means that the company is earning profit above its cost
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.