For perfectly competitive firms, economic profit exists only in the short run. Why?
Answer to relevant QuestionsWhy are demand curves for perfectly competitive firms horizontal and for firms in monopolistic competition downward sloping? Make the argument that consumers are better off when the economy's market structures are more competitive than monopolistic. Now suppose the three firms are in a monopolistically competitive market and their demand curves are as follows: Combining their cost data in practice problem 3 with their demand curves shown here, calculate how much each ...How does godfathering work? Who decides price? How do other firms in the oligopoly react to the price leader? Why? Suppose you were head of a nationwide hotel chain that had a supply of 10,000 rooms. And suppose that the demand schedule for these rooms per night was as follows: What would be the most profitable price, assuming you had a ...
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