Suppose that for each firm in the competitive market for potatoes, long-run average cost is minimized at 20¢ per pound when 500 pounds are grown. The demand for potatoes is Q = 10,000/p
If the long-run supply curve is horizontal, then how many firms will this industry sustain in the long run? A) 0
B) 100
C) 50,000
D) There is not enough information to answer.
B
You might also like to view...
If the elasticity of demand is -2.3 when calculated using the point elasticity method and -3.4 using the arc elasticity method, then
A) you should use the point elasticity. B) it is OK to use either one. C) there must be a mistake in the calculations. D) you should use the arc elasticity.
Fixed costs are:
A. costs that depend on the quantity of output produced. B. inputs costs that stay the same price per unit. C. costs that don't depend on the quantity of output produced. D. costs that are negotiated to stay the same throughout the life of a contract.
A stock is a measure defined:
A. in real terms. B. at a point in time. C. per unit of time. D. in nominal terms.
Which of the following is not believed to cause recent increases in wage inequality?
A) international trade B) contractionary monetary policy C) skill-biased technological progress D) all of the above E) none of the above