Problem 1: In long-run equilibrium a perfectly competitive firm will operate where the price is:
Select one:
a. greater than MR but equal to MC and minimum ATC
b. equal to MR, MC and minimum to ATC
c. greater than MC and minimum ATC, but equal to MR
d. greater than MR and MC, but equal to minimum ATC
Problem 2: For firms in perfectly competitive industries:
Select one:
a. Profit maximization occurs at Q where MR = ATC
b. Profit maximization occurs where TR attain a maximum
c. Profit maximization occurs at Q where P = MC
d. None of the above are true
Problem 3: Which of the following is NOT a characteristic of the perfectly competitive market structure:
Select one:
a. The product the firm produces is homogeneous or standardized
b. The firm can sell all it wants at the market clearing price
c. Consumers are assumed to have complete (perfect) information regarding the producers in the market
d. The firm may raise the price of the product it sells incurring small declines in sales