Chp 12 Market structure/perfect competition

In perfect competition, when a firm is making positive economic profit in the short run, then new firms enter the market causing the market supply curve to ______________ and the market price to ___________.

shift rightward, decrease

In perfect competition, the marginal revenue is the same as:

Price

A buyer or seller that is unable to affect the market price is called a __________.

Price taker

What is the term given to a cost that has already been paid and cannot be recovered?

Sunk costs

Which of the following is a characteristic of a perfectly competitive market? -there are large numbers of buyers and sellers -firms cannot freely enter or exit the market -the products are differentiated

There are large numbers of buyers and sellers

Long-run equilibrium in perfect competition results in:

both productive and allocative efficiency

If the average total cost curve is above the demand curve, then this firm is:

having economic losses

A firm in perfect competition earns profit if:

price is greater than average total cost

In the short run, the firm should:

operate if price > average variable cost