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In the short run, the firm's supply curve is:
Marginal cost above average variable cost.
realize a loss equal to their fixed costs.
Marginal Revenue = Marginal Cost
The marginal revenue for producing the 6th unit is $1.
Price Taker
Variable costs but not fixed costs.
They will earn higher profits or experience smaller losses.
The firm should increase production and leave price unchanged.
Let's assume that industry demand increases in the short run for a purely competitive industry.
Marginal cost above average variable cost.
realize a loss equal to their fixed costs.
Marginal Revenue = Marginal Cost
The marginal revenue for producing the 6th unit is $1.
Price Taker
Variable costs but not fixed costs.
They will earn higher profits or experience smaller losses.
The firm should increase production and leave price unchanged.
When a firm produces less, they can reduce:
Marginal cost above average variable cost.
realize a loss equal to their fixed costs.
Marginal Revenue = Marginal Cost
The marginal revenue for producing the 6th unit is $1.
Price Taker
Variable costs but not fixed costs.
They will earn higher profits or experience smaller losses.
The firm should increase production and leave price unchanged.
Let's assume that a profit maximizing firm has a marginal revenue of $10 and a marginal cost of $8.
Marginal cost above average variable cost.
realize a loss equal to their fixed costs.
Marginal Revenue = Marginal Cost
The marginal revenue for producing the 6th unit is $1.
Price Taker
Variable costs but not fixed costs.
They will earn higher profits or experience smaller losses.
The firm should increase production and leave price unchanged.
In Pure Competition, a firm profit maximizes by setting:
Marginal cost above average variable cost.
realize a loss equal to their fixed costs.
Marginal Revenue = Marginal Cost
The marginal revenue for producing the 6th unit is $1.
Price Taker
Variable costs but not fixed costs.
They will earn higher profits or experience smaller losses.
The firm should increase production and leave price unchanged.
Which of the following would be a characteristic of the Purely Competitive market structure?
Marginal cost above average variable cost.
realize a loss equal to their fixed costs.
Marginal Revenue = Marginal Cost
The marginal revenue for producing the 6th unit is $1.
Price Taker
Variable costs but not fixed costs.
They will earn higher profits or experience smaller losses.
The firm should increase production and leave price unchanged.
If a purely competitive firm shuts down in the short run, they will:
Marginal cost above average variable cost.
realize a loss equal to their fixed costs.
Marginal Revenue = Marginal Cost
The marginal revenue for producing the 6th unit is $1.
Price Taker
Variable costs but not fixed costs.
They will earn higher profits or experience smaller losses.
The firm should increase production and leave price unchanged.
Let's assume that the total revenue for producing 5 units of product is $35 and the total revenue for producing 6 units is $36. We can conclude that:
Marginal cost above average variable cost.
realize a loss equal to their fixed costs.
Marginal Revenue = Marginal Cost
The marginal revenue for producing the 6th unit is $1.
Price Taker
Variable costs but not fixed costs.
They will earn higher profits or experience smaller losses.
The firm should increase production and leave price unchanged.
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