If MiiTunes and The Rock Shop are both in the music business and faced with the choices outlined in the figure shown, we can predict the outcome will be that:
This figure displays the choices and payoffs (company profits) of two music shops-MiiTunes and The Rock Shop. MiiTunes is an established business in the area deciding whether to charge its usual high prices or to charge very low prices, in the hopes that a new business will not be able to make a profit at such low prices. The Rock Shop is trying to decide whether or not it should enter the market and compete with MiiTunes.
A. MiiTunes charges low prices and The Rock Shop does not enter.
B. MiiTunes charges high prices and The Rock Shop enters.
C. MiiTunes charges high prices and The Rock Shop does not enter.
D. MiiTunes charges low prices and The Rock Shop enters.
B. MiiTunes charges high prices and The Rock Shop enters.
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The smaller U.S. mainframe computer and peripheral equipment manufacturers of the 1960s (the "Bunch") were perfect competitors, since they produced homogenous products and had little control over the market price
Indicate whether the statement is true or false
This table shows the total costs for various levels of output for a firm operating in a perfectly competitive market.PriceQuantityTC$500$10.00$501$20.00$502$27.50$503$77.50$504$147.50$505$250.00According to the table shown, when 1 unit is produced:
A. marginal revenue exceeds marginal costs, and the firm should produce more. B. marginal costs exceed marginal revenue, and the firm should produce more. C. marginal revenue exceeds marginal costs, and the firm should produce less. D. marginal costs exceed marginal revenue, and the firm should produce less.
If aggregate quantity supplied is greater than aggregate quantity demanded at a particular price level, then a
A) shortage exists and consumers will bid the price level up. B) surplus exists and consumers will bid the price level up. C) surplus exists and the price level will decline. D) shortage exists and the price level will decline. E) c and d
“A producer wanting to employ optimal quantity of inputs should choose the point where diminishing returns set in.” True or false?
What will be an ideal response?