Figure 11
-
6
Figure 11
-
6 shows cost and demand curves facing a profit
-
maximizing perfectly competitive firm.
35.
Refer to Figure 11
-
6.
At price
P
1
, the firm would produce
A) zero units.
B)
Q
3
units.
C)
Q
1
units
D)
Q
5
units.
36.
Refer to Figure 11
-
6.
At price
P
1
, the firm would
8
37.
Refer to Figure 11
-
6.
At price
P
3
, the firm would produce
38.
Refer to Figure 11
-
6.
At price
P
3
, the firm would
39.
Refer to Figure 11
-
6.
At price
P
4
, the firm would
A) lose an amount equal to its fixed costs.
B) make a normal profit
C) make a profit
D) lose an amount less than fixed costs.
40. Market supply is found by
41. If a firm shuts down in the short run,
42. A perfectly competitive firm produces 3,000 units of a good at a total cost of $36,000. The fixed cost of
production is $20,000. The price of each good is $10. Should the firm continue to produce in the short run?
9
Figure 11
-
7
43.
Refer to Figure 11
-
7
. Suppose the prevailing price is $20 and the firm is currently producing 1,350 units. In the
long run equilibrium, the firm represented in the diagram
A) will reduce its output to 1,100 units.
B) will continue to produce the same quantity.
C) will cease to exist.
D) will reduce its output to 750 units.
44.
Refer to Figure 11
-
7.
Suppose the prevailing price is $20 and the firm is currently producing 1,350 units. In the
long run equilibrium,
