1aWhich of the following is the correct sequence of events f

1)aWhich of the following is the correct sequence of events following a decrease in demand for a product in a perfectly competitive market?

A decrease in the price and in the total profits of the representative firm which causes new firms to enter the industry.

A decrease in the price and in the total profits of the representative firm which causes firms to leave the industry.

A decrease in the price but an increase in the total profits of the representative firm which causes new firms to enter the industry.

An increase in the price but a decrease in the total profits of the representative firm which causes firms to leave the industry.

30.

50.

70.

90.

100.

A decrease in the price and in the total profits of the representative firm which causes new firms to enter the industry.

A decrease in the price and in the total profits of the representative firm which causes firms to leave the industry.

A decrease in the price but an increase in the total profits of the representative firm which causes new firms to enter the industry.

An increase in the price but a decrease in the total profits of the representative firm which causes firms to leave the industry.

b)Graph A shows the market demand and supply in a perfectly competitive market. Graph B shows the cost curves of a representative profit-maximizing firm in that industry.

$\"$900$

Refer to the above graph to answer this question. If the market is in equilibrium, what quantity will the firm produce?

	30.
	50.
	70.
	90.
	100.

$900 800 700 600 500 400 300 200 100 $900 800 700 600 500 400 300 200 100 ATC AVC 0 1 2 3 4 5 6 7 8 910 0 20 40 60 80 100 120 Quantity per period Quantity per period (In thousands) Q1. Answer is A decrease in prices and the Total profits of the representative firms which causes the firm to leave the industry. Q2. Answer is 50. Explanation: The Market is in equilibrium at a price of $400. Where demand cuts supply curve. At a price of $400 and a straight MR curve is drawn on the representative form. The MC curve cuts the MR curve from below and from that point the perpendicular is drawn at X-axis. Which shows the equilibrium Quantity to be 50.

1)aWhich of the following is the correct sequence of events following a decrease in demand for a product in a perfectly competitive market? A decrease in the pr

1aWhich of the following is the correct sequence of events f

Solution

Get Help Now

Submit a Take Down Notice