Essay
Toothpicks are sold in a perfectly competitive market. The market price is currently $3 per box of one hundred toothpicks. At its current level of production, a representative firm in the toothpick industry is producing at a level of output such that long-run average cost is $3.25 per box of one hundred toothpicks. Given this information, is the toothpick industry in equilibrium? Explain.
Correct Answer:
Verified
No, the industry is not in equilibrium. ...View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Correct Answer:
Verified
View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Q23: The table below represents cost data for
Q24: Comment on the following statement: "The shape
Q25: If a firm is earning just enough
Q26: Comment on the following statement: "When firms
Q27: If the long-run average cost curve for
Q29: Flowers.com is earning a total revenue of
Q30: If marginal costs are constant what will
Q31: What is meant by increasing returns to
Q32: Explain the relationship between price, short-run marginal
Q33: What is the optimal scale of plant?