What would happen to a monopolistic firm when the Demand curve is below its
Average Variable Cost? D < AVC
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The firm will shut down.
Determine Monopolist:
Profit- maximizing level of output
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Marginal Revenue of each product is equal to Marginal Cost of each
product, MR=MC
,Where is profit located on a graph?
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Determine Monopolist:
Total Revenue at its profit maximizing position
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If Price increases then Total revenue decreases
When are both the short-run and the long-run average costs at a minimum?
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When the firm produces at the long-run competitive equilibrium.
A purely competitive firm should increase output when?
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, Marginal Revenue is greater than Marginal Cost
MR>MC
For a short-run competitive firm, what kind of profits can be expected?
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it is possible for a firm's economic profits to be positive, negative, or zero.
Economic profits will be zero in the long-run.
When a monopolist Price (P) is greater than Average Total Cost (ATC), what kind of
profit occurs? P > ATC =
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Pure economic profit or Profit maximization
When will entry to a perfectly competitive firm occur?
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When firms are earning positive economic profits
What are some of the barriers to entry?
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Average Variable Cost? D < AVC
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The firm will shut down.
Determine Monopolist:
Profit- maximizing level of output
Give this one a try later!
Marginal Revenue of each product is equal to Marginal Cost of each
product, MR=MC
,Where is profit located on a graph?
Give this one a try later!
Determine Monopolist:
Total Revenue at its profit maximizing position
Give this one a try later!
If Price increases then Total revenue decreases
When are both the short-run and the long-run average costs at a minimum?
Give this one a try later!
When the firm produces at the long-run competitive equilibrium.
A purely competitive firm should increase output when?
Give this one a try later!
, Marginal Revenue is greater than Marginal Cost
MR>MC
For a short-run competitive firm, what kind of profits can be expected?
Give this one a try later!
it is possible for a firm's economic profits to be positive, negative, or zero.
Economic profits will be zero in the long-run.
When a monopolist Price (P) is greater than Average Total Cost (ATC), what kind of
profit occurs? P > ATC =
Give this one a try later!
Pure economic profit or Profit maximization
When will entry to a perfectly competitive firm occur?
Give this one a try later!
When firms are earning positive economic profits
What are some of the barriers to entry?
Give this one a try later!
