8.3

An increase in the cost of an input will result in

All of the above (leftward, upward, leftward)

If a competitive firm is in short-run equilibrium then

All of the above are possible in the short-run.

If a competitive firm cannot earn profit at any level of output during a given short-run period, then which of the following is least likely to occur?

It will minimize its loss by decreasing output so that price exceeds marginal cost.

There are currently N identical firms in a market. If it is a perfectly competitive market, the short-rub market supply curve at any given price is

N times the supply of an individual firm

When the production of a good involves aceras inputs, an increase in the cost of one input will usually cause total costs to

Rise less than in proportion

If a firm is currently in short-run equilibrium earning a profit, what impact will a lump-sum tax have on its production decision

The firm will not change output but earn a lower profit.

The reasons why a competitive firm's short-run supply curve is upward slipping are

The law of diminishing marginal returns and profit maximization

The competitive firm's supply curve is equal to

The portion of its marginal cost curve that lies above AVC

In a graph of a firm's short run total costs and total revenue, the total cost and the the total revenue curves, respectively, will interest the vertical axis

above the origin, at the origin

If a competitive firm is in short-run equilibrium, then

an increase in its fixed cost will have no effect on output.

In deciding whether to operate in the short run, the firm must be concerned with the relationship between price of the output and

average variable cost

A firm should always shut down if its revenue is

less than its avoidable costs

If a competitive firm finds that it maximizes short-run profits by shutting down, which of the following must be true?

p < AVC for all levels of output.

If a firm is a price taker, then its marginal revenue will always equal

price

When the production of a good involves several inputs and inputs are used in fixed proportions, an increase in the cost of one input will usually cause total costs to

rise by the exact amount of the input price increase

A firm will shit down in the short run if

total revenue from operating would not cover variable costs