If the price of an input _________ the cost of production rises.
Decrease
Increase
Constant
Leftward
A profit maximising firm in perfect competition produces where ;
Total revenue is maximised
Marginal revenue equals marginal cost
Marginal revenue equals zero
Marginal revenue equals average cost
Profit that earns over and above the normal profit is called
Depreciation
Devaluation
Super - normal profit
Budget
For a perfectly competitive firm
Total revenue is a straight line
Price is greater than marginal revenue
Price equals total revenue
Price equals total cost
___________ is a tax that the government imposes per unit sale of output.
Direct tax
Indirect tax
Unit tax
Tax
The __________ of a good measures the responsiveness of quantity supplied to changes in the prices of the good.
Price elasticity of supply
Investment
Supply
Demand
In perfect competition :
Short run abnormal profits are competed away by firms leaving the industry
Short run abnormal profits are competed away by firms entering the industry
Short run abnormal profits are competed away by the government
Short run abnormal profits are competed away by greater advertising
Firms in perfect competition face a
Perfectly elastic demand curve
Perfectly inelastic demand curve
Perfectly elastic supply curve
Perfectly inelastic supply curve
Products are heavily differentiated
The products firms offer are very similar
A few firms dominate the market
Consumers have limited information
In the short run firms in perfect competition will still produces provided
The price covers average variable cost
The price covers variable cost
The price covers average fixed cost
The price covers fixed costs
