Quiz_123 - 124 -,000bushelsofwheat atatotalcostof$36,000.$15. ofwheatinthelongrun A $15 B Thepricerisesabove$15 C

Quiz_123 - 124 -,000bushelsofwheat...

  • New York University
  • MICRO 13
  • Test Prep
  • zhangyu132
  • 4
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124) A perfectly competitive wheat farmer in a constant-cost industry produces 3,000 bushels of wheatat a total cost of $36,000. The prevailing market price is $15. What will happen to the market priceof wheat in the long run? A) The price remains constant at $15.B) The price rises above $15.C) The price falls to $12.D) There is insufficient information to answer the question.Answer: C 124) Diff: 2 Page Ref: 413 - 415/413 - 415 Topic: Constant - Cost Industry Learning Outcome: Micro 13: Explain the relationship between production and profits under perfect competition AACSB: Analytic Skills 125) A perfectly competitive wheat farmer in a constant-cost industry produces 1,000 bushels of wheatat a total cost of $50,000. The prevailing market price is $48. What will happen to the market priceof wheat in the long run? 125) Diff: 2 Page Ref: 413 - 415/413 - 415 Topic: Constant - Cost Industry Learning Outcome: Micro 13: Explain the relationship between production and profits under perfect competition AACSB: Analytic Skills 126) In August 2008, Ethan Nicholas developed the iShoot application for the apple iPhone 3G, andwithin five months had earned $800,000 from this program. By May 2009, Nicholas had droppedthe price from $4.99 to $1.99 in an attempt to maintain sales. This example indicates that in acompetitive market, 126) Diff: 2 Page Ref: 416 - 417/416 - 417 Topic: Profit Learning Outcome: Micro 13: Explain the relationship between production and profits under perfect competition AACSB: Reflective Thinking 40

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