Which of the following statements describes what perfectly competitive firms experience in the long run?
A) Price equals ATC.
B) Price equals the minimum point on AVC.
C) Price equals the minimum point on ATC.
D) Marginal revenue is greater than marginal cost.
Answer: C) Price equals the minimum point on ATC.
You might also like to view...
The demand for Olin skis is likely to be
a. less elastic than the demand for skis in general b. more elastic than the demand for skis in general c. unit elastic relative to the demand for skis in general d. as elastic as the demand for skis in general e. greater than the demand for skis in general
During the Christmas holiday season, the Fed increases the supply of currency to:
a. ensure that checks are cleared quickly. b. meet the demand for cash withdrawals from banks. c. stabilize the value of the dollar against other currencies. d. decrease the value of bonds. e. control inflation.
If the percentage change in quantity demanded of a good is smaller than the percentage change in price, consumers are very price sensitive to the price change of the good
a. True b. False Indicate whether the statement is true or false
Suppose that total expenditures for coffee reach a maximum at a price of $5 per pound. At this price, the demand for coffee is:
A. elastic. B. perfectly inelastic. C. unit elastic. D. inelastic.