Unit 3: Production, Cost and Perfect Competition

Which of the following statements can be made with certainty based on the available information?

Which of the following statements accurately describes the relationship between average product (AP) and marginal product (MP) of labor?

On the basis of the information in the table, and the assumption that total fixed costs are $100, which of the following is a correct statement?

Every time Mr. Hamm makes another pizza in his shop, he places $0.45 worth of sauce on top. For Mr. Hamm, the cost of pizza sauce is a component of which of the following? I. Total Fixed Costs II. Total Variable Costs III. Marginal Cost IV. Total Costs

Which of the following statements is true for a firm in a perfectly competitive industry?

The owner of a competitive firm making zero economic profit

A competitive firm facing the cost and revenue conditions described should

In order to find the market supply curve for a particular good, one would

The industry that makes plastic army figures uses a small fraction of the plastic demanded for all purposes. On this basis, we can conclude that the army-figures industry is most likely a(n)

How many units of output should be produced in order to maximize profit?

In the short run, a firm should shut down if

Diminishing marginal returns occur when

Based on the data, what is the marginal cost of producing the 4th unit?

A perfectly competitive firm is a price taker because

A profit-maximizing firm produces at the output level where

In long-run equilibrium, a perfectly competitive firm earns

The marginal cost curve intersects the average total cost curve at the

What is the average variable cost of producing 3 units?

In a perfectly competitive market, which of the following is true for an individual firm?

The short-run supply curve for a perfectly competitive firm is the portion of the marginal cost curve that lies above the