Homework answers / question archive / 1) If one firm in a perfectly competitive industry is somehow able to produce at a lower cost than competing firms in the short run, then: a

1) If one firm in a perfectly competitive industry is somehow able to produce at a lower cost than competing firms in the short run, then: a

Economics

Share With

1) If one firm in a perfectly competitive industry is somehow able to produce at a lower cost than competing firms in the short run, then:

a. the competing firms will adopt similar production techniques in the long run
b. the more efficient firm will earn higher profits than the competing firms in the long run
c. the competing firms will earn higher profits than the more efficient firm in the short run
d. the competing firms will go out of business in the long run

2.) If marginal cost is less than marginal revenue, a firm should:

a. expand output
b. contract output
c. maintain steady output
d. shut down

3.) The difference between the price firms would be willing to accept for their goods and the price they actually receive is called:

a. consumer surplus
b. consumer efficiency
c. allocative efficiency
d. producer surplus

4.) Under conditions of perfect competition, if profits are being made, then:

a. new firms are attracted into the industry
b. the market supply decreases
c. average revenue increases
d. new firms are excluded

5.) A monopoly can sell all that it desires at any given price.

a. true
b. false