Asked by Aa'Kyra Rivers on Jun 11, 2024
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(Table: Cherry Farm) Use Table: Cherry Farm.Suppose there are 100 farms in this industry with identical cost curves,as shown in the table.If the price is $4 per pound:
A) firms will enter the industry.
B) firms will exit the industry.
C) the industry is in long-run equilibrium.
D) the industry has maximized average total cost.
Long-run Equilibrium
A state in which all factors of production and inputs in a market are fully adjusted to the market conditions, allowing for steady-state operation without excess supply or demand.
Perfectly Competitive
A market structure characterized by a large number of small firms, homogeneous products, and no barriers to entry or exit.
Price
The capital needed to purchase a particular good or service.
- Discuss the significance of firm entry and exit within a perfectly competitive market and its impact on equilibrium over an extended period.
- Fathom the relationship among economic profits, average total costs, and market prices and their effect on enterprise operations in the long-term scenario.
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Learning Objectives
- Discuss the significance of firm entry and exit within a perfectly competitive market and its impact on equilibrium over an extended period.
- Fathom the relationship among economic profits, average total costs, and market prices and their effect on enterprise operations in the long-term scenario.
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