# The Shutdown Po In The Short Run, If P ≫ Atc, A Perfectly Competitive Firm:

When perfect competition prevails, which of the following characteristics of firms are we likely to observe? They are all price takers. They erect and maintain barriers to new firms. They all try to highlight the substantial product differentiation between producers. There are not many of them.

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If a perfectly competitive firm sells 300 units of output at \$1 per unit, its marginal revenue is: more than \$1 but less than \$300. less than \$1. \$1. \$300.
In the short run, a perfectly competitive firm produces output and breaks even if the firm produces the quantity at which: P > ATC. P P = (TR / Q + TC / Q) × Q. P = ATC.
In perfectly competitive markets, if the price is _____, the firm will _____. greater than the minimum ATC; break even greater than ATC; make an economic profit less than ATC; make an economic profit less than ATC; break even
A perfectly competitive firm will earn a profit and will continue producing the profit-maximizing quantity of output in the short run if the price is: greater than average variable cost but less than average total cost. less than marginal cost. less than the average fixed cost. greater than average total cost.
The short-run supply curve for a perfectly competitive firm is the ____ cost curve above the _____ price. average variable; shut-down marginal; shut-down average total; break-even marginal; break-even
In the short run, if AVC produces output and incurs an economic loss. produces output and earns an economic profit. does not produce output and earns an economic profit. does not produce output and earns zero economic profit.
Assume that in the short run a perfectly competitive firm does not produce output and has economic losses. This occurs at the quantity where MR = MC and: P = ATC and FC = 0. AVC 0. AVC > P > ATC and FC = 0. P 0.
Which of the following is TRUE? Price and marginal revenue are the same in perfect competition. Economic profit per unit is found by subtracting AVC from the price. Economic profit is always positive in the short run. If the price falls below the average total cost, the firm will earn economic profits.

In a long-run equilibrium, economic profits in a perfectly competitive industry are: positive. zero. negative. indeterminate.
A perfectly competitive firm will produce: only when it earns profits in the short run. mostly in the long run and only if price is greater than AFC. whenever it can. with a loss in the short run if its price is greater than AVC but less than ATC.
The assumptions of perfect competition imply that: the price will be fair. individuals can influence the market price. the price will be high. individuals in the market accept the market price as given.
Which of the following is NOT a characteristic of a perfectly competitive industry? Products are differentiated. Profits may be positive in the short run. There are many firms. Firms seek to maximize profits.
If a perfectly competitive firm decreases production from 11 units to 10 units and the market price is \$20 per unit, total revenue for 10 units is: \$200. \$10. \$210. \$20
If a perfectly competitive firm increases production from 10 units to 11 units and the market price is \$20 per unit, total revenue for 11 units is: \$200. \$10. \$20. \$220.
The marginal revenue received by a firm in a perfectly competitive market: is less than the market price. is equal to its average revenue. is greater than the market price. increases with the quantity of output sold.

In the short run, a perfectly competitive firm produces output and earns ZERO economic profit if: P > ATC. P P = ATC. P
Mikail”s perfectly competitive camera memory card-producing factory is making positive economic profits. If the price of memory cards is \$9, if Mikail”s output is 3,000 cards a month, and if his monthly average total cost is \$7, what are his monthly profits? \$2 \$6,000 \$27,000 \$21,000
The lowest point on a perfectly competitive firm”s short-run supply curve corresponds to the minimum point on the _____ curve. ATC AFC MC AVC
In the short run, if AVC does not produce output and earns an economic profit. produces output and earns an economic profit. does not produce output and earns zero economic profit. produces output and incurs an economic loss.
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