« previous next »

Author Question: Suppose a firm is a natural monopoly. Then, until the long-run average cost curve crosses the demand ... (Read 106 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?

Prostaglandins were first isolated from human semen in Sweden in the 1930s. They were so named because the researcher thought that they came from the prostate gland. In fact, prostaglandins exist and are synthesized in almost every cell of the body.

Did you know?

When blood is deoxygenated and flowing back to the heart through the veins, it is dark reddish-blue in color. Blood in the arteries that is oxygenated and flowing out to the body is bright red. Whereas arterial blood comes out in spurts, venous blood flows.

Did you know?

Despite claims by manufacturers, the supplement known as Ginkgo biloba was shown in a study of more than 3,000 participants to be ineffective in reducing development of dementia and Alzheimer’s disease in older people.

Did you know?

During pregnancy, a woman is more likely to experience bleeding gums and nosebleeds caused by hormonal changes that increase blood flow to the mouth and nose.

Did you know?

Hypertension is a silent killer because it is deadly and has no significant early symptoms. The danger from hypertension is the extra load on the heart, which can lead to hypertensive heart disease and kidney damage. This occurs without any major symptoms until the high blood pressure becomes extreme. Regular blood pressure checks are an important method of catching hypertension before it can kill you.

Oil and Natural Gas Transportation Oil and Natural Gas Transportation
When a Tornado Strikes: Social Organization Following a Natural Disaster When a Tornado Strikes: Social Organization Following a Natural Disaster
As some groups do ethnic work, they produce a mythical long-lost heritage, as in this photo of ... As some groups do ethnic work, they produce a mythical long-lost heritage, as in this photo of ...
Natural Products Natural Products
Natural Settings Natural Settings
The temperature of an average lightning bolt is 3.0 x 104 °C. What is the equiva The temperature of an average lightning bolt is 3.0 x 104 °C. What is the equiva
Video: Introduction to Dysrhythmia

For a complete list of videos, visit our video library