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Author Question: Initially, a perfectly competitive industry that has 1,000 firms is in long-run equilibrium. Then ... (Read 37 times)

cmoore54

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on: Jun 29, 2018
Initially, a perfectly competitive industry that has 1,000 firms is in long-run equilibrium. Then 100 firms in the industry adopt a new technology that reduces the average cost of producing the good.
 
  In the short run, the price ________, firms with the new technology make ________ economic profit, and firms with the old technology ________. A) remains the same; zero; incur economic losses
  B) falls; positive; incur economic losses
  C) remains the same; positive; make normal profit
  D) remains the same; positive; incur economic losses

Question 2

The above figure shows the market for labor. The employer is a monopsony. The firm will not hire 800 hours of labor because at that point
 
  A) VMP > MCL.
  B) VMP = MCL.
  C) VMP < MCL.
  D) VMP = W.


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cuttiesgirl16

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Reply #1 on: Jun 29, 2018
Answer to Question 1

B

Answer to Question 2

C


cmoore54

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Reply 2 on: Jun 29, 2018
Great answer, keep it coming :)

carojassy25

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Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

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