« previous next »

Author Question: Suppose a firm is a natural monopoly. Then, until the long-run average cost curve crosses the demand ... (Read 89 times)

shenderson6

  • Hero Member
  • *****
  • Posts: 573
on: Jun 29, 2018
Suppose a firm is a natural monopoly. Then, until the long-run average cost curve crosses the demand curve, as the quantity increases the long-run average costs
 
  A) increase.
  B) decrease.
  C) decrease and then increase.
  D) increase and then decrease.

Question 2

If the market price faced by a perfectly competitive firm increases, in the short run how does the firm respond?
 
  What will be an ideal response?


zogaridan

  • Sr. Member
  • ****
  • Posts: 328
Reply #1 on: Jun 29, 2018
Answer to Question 1

B

Answer to Question 2

If the market price rises, a perfectly competitive firm increases its output. The firm moves upward along its marginal cost curve, thereby increasing the quantity the firm will supply.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

In the ancient and medieval periods, dysentery killed about ? of all babies before they reach 12 months of age. The disease was transferred through contaminated drinking water, because there was no way to adequately dispose of sewage, which contaminated the water.

Did you know?

HIV testing reach is still limited. An estimated 40% of people with HIV (more than 14 million) remain undiagnosed and do not know their infection status.

Did you know?

The first monoclonal antibodies were made exclusively from mouse cells. Some are now fully human, which means they are likely to be safer and may be more effective than older monoclonal antibodies.

Did you know?

The top 10 most important tips that will help you grow old gracefully include (1) quit smoking, (2) keep your weight down, (3) take supplements, (4) skip a meal each day or fast 1 day per week, (5) get a pet, (6) get medical help for chronic pain, (7) walk regularly, (8) reduce arguments, (9) put live plants in your living space, and (10) do some weight training.

Did you know?

Before a vaccine is licensed in the USA, the Food and Drug Administration (FDA) reviews it for safety and effectiveness. The CDC then reviews all studies again, as well as the American Academy of Pediatrics and the American Academy of Family Physicians. Every lot of vaccine is tested before administration to the public, and the FDA regularly inspects vaccine manufacturers' facilities.

Rebound Tenderness, Apply Firm Pressure to the Abdomen Rebound Tenderness, Apply Firm Pressure to the Abdomen
Increasing Costs of Natural Disasters Increasing Costs of Natural Disasters
Trans-Alaska Pipeline System (TAPS) Crosses the Active Strike-Slip Denali Fault Trans-Alaska Pipeline System (TAPS) Crosses the Active Strike-Slip Denali Fault
Functional MRI Scans These scans of human brains show localized average increases in neural activity Functional MRI Scans These scans of human brains show localized average increases in neural activity
Endochondral ossification of long bone. Endochondral ossification of long bone.
A Receiver-Operating-Characteristic (ROC) Curve A Receiver-Operating-Characteristic (ROC) Curve
Video: Introduction to Genetics

For a complete list of videos, visit our video library