The short-run supply curve for a price-taking firm is given by: Select one: a. its short-run marginal cost curve above average fixed cost b. its entire short-run marginal cost curve c. its short-run marginal cost curve above minimum average total cost d. its short-run marginal cost curve above minimum average variable cost e. the positively sloped portion of its average cost curve

The short-run supply curve for a price-taking firm is given by: Select one: a. its short-run marginal cost curve above average fixed cost b. its entire short-run marginal cost curve c. its short-run marginal cost curve above minimum average total cost d. its short-run marginal cost curve above minimum average variable cost e. the positively sloped portion of its average cost curve

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter11: The Firm: Production And Costs

Section: Chapter Questions

Problem 21P

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Similar questions

If a profit-maximizing, competitive firm is producinga quantity at which marginal cost is between averagevariable cost and average total cost, it willa. keep producing in the short run but exit themarket in the long run.b. shut down in the short run but return toproduction in the long run.c. shut down in the short run and exit the market inthe long run.d. keep producing both in the short run and in thelong run.
In the short-run, if the marginal cost of a firm in a competitive industry is upward sloping while itsaverage variable cost is downward sloping, what can you say about slope of average total cost?
The formula for total fixed cost is Select one O A TFC TVC-TC O B. TFC-TC/TVC C TFC=TC-TVC. O D TFC-TC TVC
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What is the law of diminishing returns? Why does marginal product eventuallydiminish?b. Explain the relationship between marginal product and average product. Lin’s makes fortune cookies. Anyone can make and sell fortune cookies, so thereare dozens of producers. All fortune cookies are the same and buyers and sellersknow this fact. In what type of market does Lin’s operate? What determines theprice of fortune cookies? What determines Lin’s marginal revenue?d. What is the shape of the AFC curve and why does it have this shape?
Show that for a proit-maximizing firm producing at its optimal quantity, y, its average total costis minimized when marginal cost is equal to average total cost. Some tips to get you started:
The following table provides information about long-run average cost curve of a firm: Quantity LRAC 100 50 200 43 300 39 400 39 500 44 600 52 a. For output levels between 300 and 400, the firm has constant returns to scale. b. This cost structure is an example of natural monopoly. c. For output levels greater than 400, the firm has economies of scale. d. For the first 300 units of output, this firm has diseconomies of scale.
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In the Widgit industry, fixed costs are more than marginal cost. Also, Average Total Cost increases after a company produces 1,000 Widgits. What must be true about the marginal cost of the 1001 Widgit? O a. The marginal cost of the 1001 Widgit is LESS than the marginal cost of the 1000 widgit O b. The marginal cost of the 1001 Widgit is the SAME as the marginal cost of the 1000 Widgit O c. None of these are correct O d. The marginal cost of the 1001 Widgit is MORE than the marginal cost of the 1000 widgit O e. The 1001 widgit could cost more or less or the same as the 1000 widgit
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