Exam 11: Pure Competition in the Long Run

Purely competitive industry X has constant costs and its product is an inferior good.The industry is currently in long-run equilibrium.The economy now goes into a recession and average incomes decline.The result will be:

When entrepreneurs in competitive industries successfully innovate to lower production costs,it usually results in long-run economic profits for the firm.

Which of the following statements is correct?

Entrepreneurs in purely competitive industries:

If a purely competitive firm is producing at the MR = MC output level and earning an economic profit,then:

(Consider This)Which of the following statements is true about U.S.firms?

If a purely competitive firm is producing where price exceeds marginal cost,then:

Which of the following statements is correct?

Marginal cost is a measure of the alternative goods that society forgoes in using resources to produce an additional unit of some specific product.

We would expect an industry to expand if firms in that industry are:

If for a firm P = minimum ATC = MC,then:

Assume a purely competitive firm is maximizing profit at some output at which long-run average total cost is at a minimum.Then:

(Consider This)The average life expectancy of a U.S.business is approximately:

Suppose an increase in product demand occurs in a decreasing-cost industry.As a result:

Because the equilibrium position of a purely competitive seller entails an equality of price and marginal costs,competition produces an efficient allocation of economic resources.

Under pure competition in the long run:

Which of the following would not be expected to occur in a purely competitive market in long-run equilibrium?

Which of the following outcomes is consistent with a purely competitive market in long-run equilibrium?

A purely competitive firm is precluded from making economic profits in the long run because:

If a purely competitive constant-cost industry is realizing economic profits,we can expect industry supply to: