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mdagenh1 mdagenh1
wrote...
Posts: 357
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A week ago

Question 1.

Suppose Alexander is successful in establishing a profitable market for his vegan bakery in what is a monopolistically competitive industry. In the long run, Alexander will most likely find it ________ to remain profitable as he faces ________ competition in the vegan bakery market.



harder; less



harder; more



easier; less



easier; more



Question 2.

Figure 13-17




Refer to Figure 13-17. What is the productively efficient output for the firm represented in the diagram?



Qf units



Qg units



Qh units



Qj units

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InMicro


Edition: 1st
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wrote...
A week ago

Answer 1

harder; more



Answer 2

Qj units

wrote...
A week ago
Brilliant
wrote...
A week ago

Question 1.

Figure 13-17




Refer to Figure 13-17. What is the allocatively efficient output for the firm represented in the diagram?



Qf units



Qg units



Qh units



Qj units



Question 2.

Figure 13-17




Refer to Figure 13-17. What is the amount of excess capacity?



Qh - Qg units



Qj - Qf units



Qh - Qf units



Qj - Qh units

wrote...
A week ago

Answer 1

Qh units



Answer 2

Qj - Qf units

wrote...
A week ago

Figure 13-17




Refer to Figure 13-17. Suppose the firm is currently producing Qf units. What happens if it increases its output to Qg units?



It will be taking advantage of economies of scale and will be able to lower the price of its product.



Its average cost of production will fall and its profit will rise.



It will move from a zero profit situation to a profit situation.



It will move from a zero profit situation to a loss situation.

wrote...
A week ago

It will move from a zero profit situation to a loss situation.

wrote...
A week ago
Helps a lot... Now I'm ready for my quiz
wrote...
A week ago

Figure 13-17




Refer to Figure 13-17. In the long run, why will the firm produce Qf units and not Qg units, which has a lower its average cost of production?



At Qg, marginal revenue is less than average revenue which will result in a loss for the firm.



The firm's goal is to charge a high price and make a small profit rather than a low price and no profit.



At Qg, average cost exceeds marginal cost so the firm will actually make a loss.



Although its average cost of production is lower when the firm produces Qg units, to be able to sell its output the firm will have to charge a price below average cost, resulting in a loss.

wrote...
A week ago

Although its average cost of production is lower when the firm produces Qg units, to be able to sell its output the firm will have to charge a price below average cost, resulting in a loss.

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