25 Suppose there is an improvement in the technology of producing TVs and the

25 suppose there is an improvement in the technology

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25. Suppose there is an improvement in the technology of producing TVs and the production of TVs is a competitive industry. Assuming that the TV industry is initially in equilibrium, the long-run effect of this improvement is: a. lower TV prices and greater TV production. 26. Refer to the graphs shown, which depict a perfectly competitive market and firm in a constant-cost industry. If market demand increases from D 0 to D 1 , in the long run: a. new firms will enter this market and price will return to P 0 . 27. As long as marginal cost is below marginal revenue, a perfectly competitive firm should: a. Increase production 28. Refer to the graph shown depicting a perfectly competitive firm. If average variable cost is $3 at quantity 450, points A through E represent the: a. Firm’s Supply Curve 29. The demand for clothing increases. As a result, the price of clothing increases above the minimum average cost of producing it. In the long run, if the clothing industry is perfectly competitive and is a constant-cost industry: a. the supply of clothing will increase but the price will not.
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30. Refer to the following graph. a. incurring a loss, but the loss is smaller than it would be if the firm shut down.
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