Econ Unit 3 Review Part 1

Front

Price takers are individuals in a market who:

Back

have no ability to affect the price of a good in a market.

Front

The demand curve for a perfectly competitive firm is:

Back

perfectly elastic.

Front

Which of the following is true? If price falls below average variable cost, the firm will shut down in the short run. Total revenue and marginal revenue are the same in perfect competition. Economic profit per unit is found by subtracting MC from price. Economic profit is always positive in the long run.

Back

If price falls below average variable cost, the firm will shut down in the short run.

Front

Back

Stay open and take a loss

Front

Back

Normal Profit

Front

Back

Positive Economic Profit

Front

Back

Shut Down

Front

This perfect competitor will maximize profits at what output level? Options: A, B, C, D

Back

C

Front

A factor that makes it difficult for firms to enter a market is called...

Back

a barrier to entry

Front

MR DARP stands for

Back

marginal revenue, demand, average revenue, price, all of the above