Econ Hw #11 perfect competition

___ profit creates an incentive for other perfectly competitive firms to enter the market

economic

zero __ profit or normal profit is the revenue needed for a companys to break even and meet operating costs without loss

economic

all firms maximize profits by producing the quantity of output at which the marginal __ is equal to the marginal ___

revenue; cost

profit equals ___ minus average total ___ multiplied by output

revenue; cost

average revenue is the

amount of revenue per unit of a product sold

if the market price is below the average variable cost, the business is not bringing in enough revenue to compensate for the ____ costs

variable

total revenue the __ and __ costs of production is economic profit

explicit; implicit

find the new market supply by __ the short-run supply curves for all the firms in the market

adding

the perfectly competitive model is the most efficient type of market and is characterized by both

allocative; productive

total revenue divided by the number of units of product sold __ revenue

average

for a perfectly competitive firm, the market price is equal to

demand; marginal revenue; average revenue

in decreasing-cost industries, the cost of production falls with expanded output, and the ling-run market supply curves slopes

downward

in a constant-cost industry, the long-run supply curve is a __line originating at the market price that generates __ profits for the firms in the industry

flat; normal

the two conditions that guarantee consumers will enjoy the lowest prices possible are

individual firms being price takers; every firm producing the exact same product

when the total revenue is __ than the total cost, the level of profit that occurs is a loss

less

when the total revenue earned by a firm is less than the total cost of production the firm faces a __

loss

in the presence of __ firms exit until the market reaches the point at which the firms are generating a __profit; then exit stops, and the market settles down into its __-run equilibium

losses; normal;long

as the market price decreases, all else held constant, a profit-maximizing firm can ____ its production

lower

extra or additional revenue with the production of an additional unit of output is the __ revenue

marginal

a firms short-run supply curve is the portion of the ___ cost curve that is at or above the minimum point of the average ___ cost curve

marginal; variable

in the short run, as the __ rise, so does the level of output supplied

price

the long-run curve represents the long-run relationship between the __ and the ___ supplied

price, quantity

___ efficiency is producing output at the lowest possible average total cost of production

productive

profit equals ___ revenue minus __ cost

revenue; total

in a perfectly competitive market, the price the firm should charge is the market price because the firm is a price __

taker