Int Chap 9

Which best describes the type of good sold in a competitive market?

• Differentiated

• Unique

• Homogenous

• Luxury

The market price for kiwi is $0.50. Each competitive firm will face a perfectly elastic demand curve

• at a price below $0.50.

• at $0.50.

• at a price above $0.50.

If the market price for rye is $4.00/lb, each competitive firm's marginal revenue (MR) will be

• above $4.00

• equal to $4.00

• below $4.00

The Golden Rule for profit- maximization in economics is

• Marginal Revenue = Marginal Cost

• Marginal Revenue = Price

• Marginal Revenue > Marginal Cost

• Price = Minimum Average Cost

In a competitive market, if all firms are earning positive economics profit in the short run, what can we expect to happen in the long run?

• Firms will increase their production

• New firms will enter the market

• Some firms will leave the market

• Firms will shut down temporarily.