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What triggers entry in a competitive market? Describe the process that ends further entry.
In perfect competition, when market demand increases, explain how the price of the good and the output and profit of each firm changes in the short run.
In perfect competition, when market demand decreases, explain how the price of the good and the output and profit of each firm changes in the short run.
Explain how the shutdown decision will affect GM Chevy Volt's TFC, TVC , and TC .
What is the relationship between a firm's supply curve, its marginal cost curve, and its average variable cost curve?
How might Gap take advantage of economies of scale by combining concept stores into one store?
Explain why Gap is making a decision to reduce the size of its stores. Is Gap's decision a long-run decision or a short-run decision?
Construct Terri's marginal product and average product schedules. Over what range of workers do marginal returns increase?
What is Jackie's minimum efficient scale? Does Jackie's production function feature economies of scale or diseconomies of scale?
What are economies of scale and diseconomies of scale? How do they arise? What do they imply for the shape of the LRAC curve?
Which of Avalon's decisions described in the news clip is a short-run decision and which is a long-run decision?
What type of cost is your expenditure on tickets? Why is the cost of the ticket irrelevant to your current decision about whether to stay at home?
By how much will Avalon's shortrun decision increase its total variable cost? By how much will Avalon's long-run decision increase its monthly total fixed cost?
How do fluctuations in the price of corn and in transportation costs influence PepsiCo's short-run cost curves?
Explain why Starbucks is opening cafés in Target stores rather than standalone cafés. How does Starbucks reap economies of scale in the example on p. 265?
What is Coinstar's total fixed cost of operating one self-serve kiosk? What are its variable costs of providing coffee at a self-serve kiosk?
If Jim changes the quantities that he buys, will he buy more or fewer muffins and more or less coffee? Explain your answer.
Why do you think Microsoft works with a large number of other firms, rather than performing all the required tasks itself?
At the end of 2012, Toni could have sold her computer for $500. Calculate Toni's opportunity cost of production and her economic profit in 2012.
Estimate a range for the four-firm concentration ratio and the HHI for the game market based on the data provided in this news clip.
Why do some firms use a lot of capital and small amounts of labour while others use small amounts of capital and a lot of labour?
Under what conditions do the measures of concentration give a good indication of the degree of competition in a market?
What are the main reasons why firms can often coordinate production at a lower cost than markets can?
At the end of the year, Joe was offered $500 for his business and all its equipment. Calculate Joe's opportunity cost of production and his economic profit.
What is the economic problem that CEO compensation schemes are designed to solve? Would paying executive with shares of the company's stock align their interes?