A profit-maximizing firm in a perfectly competitive market that is facing a price of $10 decides to produce 100 widgets. This results in an economic profit of $80. If the marginal cost of producing the 100th widget was $12 then this firm should:
| produce less than 100 |
| set the price at $12 |
| produce more than 100 |
| continue producing 100 |
Which of the following is true for the firm in a perfectly competitive industry?
| There are no pricing decisions to be made by the firm |
| The firm has complete control over the price that it will charge |
| Each seller is relatively large compared to the market |
| The products supplied by the firms are differentiated |
| The demand curve slopes downward |
A profit-maximizing firm in a perfectly competitive market that is facing a price of $10 decides to produce 100 widgets. This results in an economic profit of $80. If the marginal cost of producing the 100th widget was $12 then this firm should
Correct Answer:- produce less than 100
Reason:- The price is more than he cost thus it should produce less than 100 widget
Which of the following is true for the firm in a perfectly competitive industry?
Correct Answer:- The demand curve slopes downward
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