Exam 8: B--Perfect Competition

Long-run expansion in an increasing-cost industry increases each firm's marginal and average costs by

Resources are efficiently allocated when production occurs at that point at which

Economic profits in a competitive industry are signals that

Figure 8-21 Consider Figure 8-21.If the market price is P₂, which of the following best describes the long-run implications for the industry?

Experimental evidence suggests that

A general conclusion from experimental economics is that market experiments

Figure 8-21 Consider Figure 8-21.If the market price is P₃, which of the following best describes the long-run implications for the industry?

The term allocative efficiency refers to

In the short run, producers derive surplus from market exchange because

The purpose of experimental economics is to

In the short run, producer surplus equals

If you were to put the following effects of a decrease in demand into the sequence in which they occur, which would be last?

Compared to the short run, the long-run market supply curve is

Whether the firm produces or shuts down in the short run, fixed cost is equal to

In a double continuous auction,

The relationship between price and quantity supplied after firms fully adjust to any short-term economic profit or loss resulting from a change in demand is illustrated by the

The experimental evidence on posted-offer pricing suggests that

A firm that minimizes average cost will not survive in the long run.

Social welfare is

Market exchange usually benefits