A firm in a purely competitive industry is currently producing 1,200 units per day at a total cost of $450. If the firm produced 1,000 units per day, its total cost would be $300, and if it produced 700 units per day, its total cost would be $275.

Answer #4  (bolded), keep in mind I input 0.00 which was incorrect

1. What is the firm's ATC per unit at these three levels of production?

   At 1,200 units per day, ATC = $ 0.38  Numeric ResponseEdit Unavailable. 0.38 correct..

   At 1,000 units per day, ATC = $ 0.30  Numeric ResponseEdit Unavailable. 0.30 correct..

   At 700 units per day, ATC = $ 0.39  Numeric ResponseEdit Unavailable. 0.39 correct..

2. If every firm in this industry has the same cost structure, is the industry in long-run competitive equilibrium?

   No Correct

3. From what you know about these firms' cost structures, what is the highest possible price per unit in long-run equilibrium?

   $ 0.3 Numeric ResponseEdit Unavailable. 0.3 correct.

4. If that price ends up being the market price and if the normal rate of profit is 10 percent, then what will each firm's accounting profit per unit be?

   
   

Answer rating: 100% (QA)

Question A firm in a purely competitive industry is currently producing 1200 units per day at a total cost of 450 If the firm produced 1000 units per day its total cost would be 300 and if it produced ... View the full answer