Question

Long-run equilibrium for a perfectly competitive firm is expressed by which of the following equations? a....

Long-run equilibrium for a perfectly competitive firm is expressed by which of the following equations?

a. MC = LRAVC = SRAVC b. MC = MR = LRAC = SRATC
c. MR = MC = SRAVC = SRATC d. MC = MR = SRTC = AFC

Free market entry is defined by which of the following?

a. Markets do not charge firms a fee to enter. b. There is no cost for firms to enter into a market.
c. Firms with sufficient capital can enter if they wish. d. Old firms must leave when new firms enter the market.

Which of the following does a leftward shift in the demand curve of a perfectly competitive market mean in the long run?

a. New firms will leave the market. b. New firms will enter the industry.
c. Price will increase. d. Short-run industry supply will increase.

What does a leftward shift in the demand curve in a perfectly competitive market mean in the long run?

a. The price will decrease and firms will exit the market. b. New firms enter the market.
c. The short-run industry supply curve shifts to the right. d. Price will increase.

Homework Answers

Answer #1

Q1) Perfectly competitive firm in long run equilibrium where MR= MC = LAC= SAC.

Correct answer is B

Q2) Free Market is where firm can enter and exit freely without any intervention of anyone there is no monopoly or need for any license .

Correct answer is B when there is no cost for firm to enter

Q3) When demand curve shift leftward that mean demand for the goods has decreased. When demand decrease firm will exit the market . No longer profitable  

Correct answer is A

Q4) When demand shift leftward there is decrease is demand and price will fall . Dirm will exist the market .

Correct answer is A

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Which of the following will not happen in the long run as demand shifts to the...
Which of the following will not happen in the long run as demand shifts to the left in a perfectly competitive market? a. Market price will fall. b. Firms will leave the market. c. The short-run industry supply curve will shift to the left. d. Equilibrium output will increase. In the long run, what does it mean when demand shifts rightward in a perfectly competitive market? a. Equilibrium price will decrease. b. Firms will leave the market. c. The short-run...
19. Suppose a perfectly competitive firm and industry are in long-run equilibrium and the firm earns...
19. Suppose a perfectly competitive firm and industry are in long-run equilibrium and the firm earns an economic profit in the short run. Which of the following is likely to occur in the long run? a. There will be an increase in the amount of economic profit earned by the firm. b. The market supply curve will shift to the left, and the market price will increase. c. The market supply curve will shift to the right, and the market...
If firms in a perfectly competitive industry are making zero economic profit, then a some of...
If firms in a perfectly competitive industry are making zero economic profit, then a some of those firms will leave the industry because firms cannot persistently go without making economic profit. b new firms will enter the industry, because the new entrants would be ensured of doing as well as in their best foregone alternative. c there is no incentive for either entry or exit. d some of the firms will temporarily shut down. e The supply curve shifts to...
17.   Assume that a perfectly competitive industry is operating at its long run equilibrium. Then, the...
17.   Assume that a perfectly competitive industry is operating at its long run equilibrium. Then, the demand for its product increases. Which of the following best describes the SHORT RUN response? A.  market demand shifts right, firms' demand curves decrease, and output decreases. B.  market demand shirts right, firms' demand curves decrease, and output increases. C.  market demand shifts right, firms' demand curves increase, and output increases. D.  market demand shirts right, firms' demand curves increase, and output decreases. 18.   Assume that the increase...
If all firms in a perfectly competitive industry earn zero economic profits, in the long run,...
If all firms in a perfectly competitive industry earn zero economic profits, in the long run, the: Select one: a. industry supply curve will shift to the right. b. number of firms in the industry will decrease. c. number of firms in the industry will increase. d. industry supply curve will not shift.
In the short run there are 400 firms in a perfectly competitive market, all with the...
In the short run there are 400 firms in a perfectly competitive market, all with the same total cost function: SRTC = 2.5q2 + 5q + 40. Suppose the market demand curve is represented by P = 165 - 0.0875Q. The profit earned by each firm in the short run is a. $0 b. -$40 c. -$50 d. $30 e. $75 Each firm in a perfectly competitive market has long-run total cost represented as LRTC = 100q2 - 10q +...
When a firm leaves a perfectly competitive industry, Group of answer choices the individual demand curves...
When a firm leaves a perfectly competitive industry, Group of answer choices the individual demand curves facing remaining firms shift towards the point of minimum average cost in the long run. the short-run industry supply curve shifts to the right. at the new long-run equilibrium, the remaining firms in the industry will each receive a higher profit. short-run industry equilibrium is re-established at a new point along the original short-run industry supply curve.
32.   The relationship that indicates that the perfectly competitive firm in long-run equilibrium is economically efficient...
32.   The relationship that indicates that the perfectly competitive firm in long-run equilibrium is economically efficient is that A.   long-run marginal cost equals long-run average cost at long-run average cost’s lowest value. B.   the typical firm earns neither economic profits nor economic losses. C.   marginal benefit equals long-run marginal cost. D.   demand equals marginal revenue equals average revenue equals price. 33.   The perfectly competitive lobster market is in long-run equilibrium. Following an increase in demand we would expect the typical...
Illustrate the model of a perfectly competitive firm that is in long-run equilibrium. Your graph should...
Illustrate the model of a perfectly competitive firm that is in long-run equilibrium. Your graph should have the demand curve facing the firm, price, MR, MC, and ATC. Identify the optimal level of output. What is the firm’s profit in the long-run?
In long-run competitive equilibrium, P = MC = SRATC = LRATC. Because P = MR, we...
In long-run competitive equilibrium, P = MC = SRATC = LRATC. Because P = MR, we can write the preceding condition as P = MR = MC = SRATC = LRATC. The condition thus consists of four parts: (a) P = MR, (b) MR = MC, (c) P = SRATC, and (d) SRATC = LRATC. Part (b)—MR = MC—is true because the perfectly competitive firm attempts to maximize profits, and that equation represents how it does so. What are the...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT