ECON 260 7. Refer to Table #1 Consumers are willing topay $68 perunt ofport wine
ID: 1115184 • Letter: E
Question
ECON 260 7. Refer to Table #1 Consumers are willing topay $68 perunt ofport wine what is Soper's Port V neyard's economic profit att ei profit maximizing point? a. $45. b.-$45 c. $15 d. -$15 8. The long-run supply curve for a firm in a perfectly competitive market is a. horizontal. b. likely to slope downward c. the portion of its marginal cost curve that lies above its min(ATC) and beyond d. the portion of its marginal cost curve that lies above its min(AVC) and beyond 9. When profit-maximizing firms in competitive markets are earning negative profits, a. new firms will enter the market. b. market demand must exceed market supply at the market equilibrium price c. market supply must exceed market demand at the market equilibrium price. d. the most inefficient firms whose their AVC is above the market price will leave the marketExplanation / Answer
(7) Table 1 is missing!
(8) (d)
In both short run and long run, a firm's supply curve is the upward rising portion of MC curve lying above minimum point of AVC curve. Below this level, firm produces and supplies nothing.
(9) (d)
If firms have AVC higher than price, they cannot cover their variable costs with revenue and they shut down even in short run, exiting the market.
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