If a firm in a perfect competition sets a price lower than the market price, what happens?

The firm will quickly sell out & market price doesn't change

The best example of a commodity from the list below is:

pure sugarcane in the market for sugarcane

If a firm in perfect comp. produces where MR = MC but makes an Econ Loss in the short run...

If price > AVC, they should stay in business

If firms in perfect competition make econ profit in the SR, what happens in the Long Run?

firms enter the industry until Econ Profit is 0

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Micro - PC 1

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A #microecon review of perfect competition and monopoly

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Answers

1
If a firm in a perfect competition sets a price lower than the market price, what happens?
The firm will quickly sell out & market price doesn't change
The firm will quickly sell out & decrease the market price
The firm will sell more & market price doesn't change
The firm will sell more & decrease the market price
2
The best example of a commodity from the list below is:
Toyota's Camry in the market for cars
Dasani water in the market for bottled water
Pepsi in the market for soft drinks
pure sugarcane in the market for sugarcane
3
The demand curve for a perfectly competitive FIRM is
upward sloping
always horizontal
Downward sloping
Downward sloping OR horizontal
4
A perfectly competitive firm's supply curve is:
The MC curve in its entirety
The MC curve above the ATC
The downward sloping part of the MC curve only
The MC curve above the AVC
5
If a firm in perfect comp. produces where MR = MC but makes an Econ Loss in the short run...
It should always shutdown
If price > AVC, they should shut down
It should always stay in business
If price > AVC, they should stay in business
6
Which Flag?
El Salvador
Venezuela
Italy
Mexico
7
When Q = 20; ATC = $5; AVC = $3; P = $7. Find Econ Profit.
$80
$100
$40
$140
8
Where should a firm produce to maximize profit?
MR = ATC
MR = MC
Demand = MR
MC = ATC
9
If firms in perfect competition make econ profit in the SR, what happens in the Long Run?
firms enter the industry until Econ Profit is 0
Firms continue to make Econ Profit
firms enter the industry & reduce Econ Profit (but not to 0)
firms enter the industry until Econ Profit is negative
10
Which Flag?
Turkey
Yemen
Vietnam
North Korea

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