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You are watching: The minimum efficient scale of a firm:
2. Answer : a. Lowest rate of output at which long run average cost is at a minimum. Explanation : When Typical price is its minimum, this level of production is dubbed as reliable range. Becouse below for maximum manufacturing the cost is minimum. So at…View the complete answer
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Transcribed photo text: 2. The minimum reliable range for a firm is the A) B) C) lowest rate of output at which long run average price is at a minimum. lowest rate of output at which brief run average total price is at a minimum. lowest price of output at which short run average variable expense is at a minimum. average of the rates of output at which lengthy run average cost is at a minimum. average of the rates of output at which short run average complete price is at a minimum. D) E) 3. Which of the adhering to reflects diseconomic situations of scale? A) Marginal product decreases as output boosts B) Brief run marginal cost increases as output rises. C) Long run marginal cost rises as output boosts D) Quick run average price rises as output increases. E) As output doubles, long run full price even more than doubles. 4. Which of the complying with is not necessarily a characteristic of perfect competition? A) B) C) D) E) Low prices A large number of buyers and also sellers A homogeneous product ( Perfect indevelopment (completely informed buyers and sellers) Easy entry and exit in the long run (openly mobile) Farmer Fanny sells her plants in a perfectly competitive industry. If she produces 500 bushels for full revenue of $3,000 and if harvesting the 501 bushel would certainly raise her complete expense from $2500 to $2510, her 5. A) revenue will increase by $4.00 if she harvests the 501" bushel. B) revenue will certainly loss by $4.00 if she harvests the 501" bushel. C) average fixed price will certainly rise if she harvests the 501 bushel. D) profit will fall by $10.00 if she harvests the S01" bushel. E) profit will certainly loss by $4.00 if she harvests the 501 bushel Ifa perfectly competitive firm shuts down in the short run, its total cost equates to zero. 6. A) True B) False When marginal revenue amounts to marginal expense, the perfectly competitive firm simply breaks also (in all instances as illustrated in Exhilittle bit 6 of your text, "Outline of Short-Run Output Decisions). 7. A) True B) False 8. A perfectly competitive firm has actually a horizontal supply curve in the short run. A) True B) False In perfect competition, each firm's output is a big fractivity of full sector supply 9. A) True B) False Perfectly competitive firms are sometimes dubbed price equipments because they have considerable regulate over product price. 10. A) True B) False