If a purely competitive firm is producing at the P = MC output and realizing an economic

Fantastic news! We've Found the answer you've been seeking!

Question:

If a purely competitive firm is producing at the “P = MC” output and realizing an economic profit, we can say that at that output:

a. Marginal revenue is less than price

b. Price exceeds average total costs. (ATC)

c. ATC is being minimized

d. Total revenue equals total cost

Related Book For answer-question

Managerial Economics and Organizational Architecture

ISBN: 978-0073375823

5th edition

Authors: James Brickley, Jerold Zimmerman, Clifford W. Smith Jr

See More Books

Posted Date: Oct 25, 2019 11:05 AM

See More Questions

Define marginal revenue. Explain why marginal revenue is less than price when demand curves slope downward.
Explain why marginal revenue is less than or equal to price. How does the difference between price and marginal revenue depend on the price elasticity of demand?
A purely competitive firm whose goal is to maximize profit will choose to produce the amount of output at which: a. TR and TC are equal. b. TR exceeds TC by as much as possible. c. TC exceeds TR by...
What do we really learn from studying how managers actually spend their time and their decision-making powers in like-for-like organisations in different countries? What are the messages for key...
Read about the massive fraud committed by Russell Wasendorf Sr. at PFG that is described in Problem 10-70. Use appropriate resources to document the latest developments in the case against Wasendorf....
The Galileo thermometer, or Termometro Lentos (slow thermometer in Italian), consists of a vertical, cylindrical flask containing a fluid and several glass floats of different color. The floats all...
Using the data in question 4, Department Xs contribution to overhead as a percentage of sales is a. 20%. c. 12%. e. 32%. b. 30%. d. 48%. Data From Question 4 A company operates three retail...
Purchase of Equipment with Zero-Interest-Bearing Debt Sterling Inc. has decided to purchase equipment from Central Michigan Industries on January 2, 2010, to expand its production capacity to meet...
Risk of entry Bargaining power of suppliers Bargaining power of buyers Threat of substitutes Power of complement providers Rivalry among established firms in industry Which of the above forces are...
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
Equipment that cost $ 92000 and on which $ 49000 of accumulated depreciation has been recorded was disposed of for $ 52500 cash. The entry to record this event would include a loss of $ 9500 . gain...
A client is planning to invest $55 thousand at the end of this year into an investment account. He tells you that he plans to retire in 35 years, and expects to have 490 thousand in that account at...
A project requires an initial investment of $8 million, and is anticipated to generate a single cash flow of $15 million in 2 years. What is the internal rate of return on the project? Enter answer...
CMS Corporation's balance sheet as of today is as follows: Long-term debt (bonds, at par) Preferred stock Common stock ($10 par) Retained earnings Total debt and equity $10,000,000 1,700,000...
A machinery upgrade project will cost $13 million, and produce cost savings of $4 million in perpetuity. What is the project NPV if the required rate of return is 10% ? Enter answer in millions, to...
Q1. How would you characterize AHP's operating strategy a) What are the implications for AHP's basic business risk? b) What are the implications for AHP's financial strategy? Q2. What capital...
BART trains are powered by electricity. A BART train weighs about 50 tons and has a top speed of 80 mph. (a) How much kinetic energy in kW-hrs does a BART train have when going full speed? (b) BART...
Nate prepares slides for his microscope. In 1 day he prepared 12 different slides. Which equation best represents y, the total number of slides Nate prepares in x days if he continues at this rate? A...
Formulate the following situation as an extensive form game (using a game tree) and solve it using backward induction. Bingo Corporation and Canal Corporation are the only competitors in the...
What mechanisms are used to address the incentive conflicts in corporations?
What does it mean to overpay a CEO? Do you think that some CEOs are overpaid? What about the typical CEO?
True or False: Annual worth analysis is the most popular DCF measure of economic worth.
Consider a palletizer at a bottling plant that has a first cost of $$150,000,$ operating and maintenance costs of $$17,500$ per year, and an estimated net salvage value of $$25,000$ at the end...
True or False: Unless non-monetary considerations dictate otherwise, choose the mutually exclusive investment alternative that has the greatest annual worth over the planning horizon.

If a purely competitive firm is producing at the P = MC output and realizing an economic

Question:

Expert Answer:

b Price exceeds Average total CostATC Marginal revenue MR the total additional revenue from s... View the full answer

Managerial Economics and Organizational Architecture

Students also viewed these economics questions