UNIVERSITY CANADA https://ucanwvest.ca/ P= M*V/Y 2. If you are operating a business in a perfectly competitive market. You can sell as much as at the market price. Why can you not simply increase your profits by selling a highest quantity? Answer: at high level of production marginal cost and average cost of production will rise. 3. Your company operates in a perfectly competitive market. Your Manager told you that advertising can help you increase your sales in the short run. What kind of advertising campaign you will start for vour product and how much gain is expected from an effective advertisement? 10:46 AM Ps ^ E= ) ENG 2020-03-18

UNIVERSITY CANADA https://ucanwvest.ca/ P= M*V/Y 2. If you are operating a business in a perfectly competitive market. You can sell as much as at the market price. Why can you not simply increase your profits by selling a highest quantity? Answer: at high level of production marginal cost and average cost of production will rise. 3. Your company operates in a perfectly competitive market. Your Manager told you that advertising can help you increase your sales in the short run. What kind of advertising campaign you will start for vour product and how much gain is expected from an effective advertisement? 10:46 AM Ps ^ E= ) ENG 2020-03-18

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter5: Investment Decisions: Look Ahead And Reason Back

Section: Chapter Questions

Problem 5.6IP

See similar textbooks

Similar questions

Explain why have no competitors caught up with Apple? Do you think Apple can sustain its success with so few products? What would you ask Apple to design next and why?
a. John operates a firm producing t shirts. There are many such firms producingidentical products to John. What market structure is this? Is it possible for John tomake a profit in the long run? Illustrate using an appropriate diagram. b. John decides to innovate his business and begins printing t shirts with customercreated content. Will John be able to make a profit in the short run and the longrun? Explain using relevant diagrams and comment on the implied market c. Provide a strategy for John to make greater than normal profits in the long run. Isthis likely to be the case in the market for this good?
EXAMPLE: Paulo's Ping Pong Balls is a firm that operates in a competitive market. The ping pong balls selI for $3 per package. Fill In the following table and determine the profit-maximizing level of output: Total Cost Marginal Revenue Marginal Cost Price Total Revenue Output Profit $3 $1.50 1 3 2.00 3 3.00 3 3 4.50 4 6.50 3 9.00 6. 3 12.00 7. 15.50 19.50 6. 24.00
The following graph shows a firm’s marginal cost and average cost of production of raspberries. a. The equilibrium price at this market is $2.5. At this price, is the firm earning economic profit or is itincurring economic losses?b. Is the firm operating in a competitive market based on the given information? Why?c. Suppose the price of raspberries increases to $5. How would you answer a. and b. in this case?d. If the market is indeed competitive, what will happen after the price increase in c.? What will bethe final price and the long-term profit of the firm?
What is an example of another business that stays open even when it's slow, and its revenue does not seem like it could cover its costs? Use microeconomics terms to explain
The graph shown below is that of Do Drop In, a shop in the dry-cleaning industry. a) At the optimal output, what price will Do Drop In charge and what will be its output? Price: $ Output: units b) At the optimal price and output, what will be its total revenue, total cost, and total loss? TR: $ ; TC: $ Total loss: $ c) If this firm made a rational decision to continue to produce, despite the loss, average variable cost must be below what level? AVC must be less than $ .
st.ca/ 2. If you are operating a business in a perfectly competitive market. You can sell as much as at the market price. Why can you not simply increase your profits by selling a highest quantity? Answer: 3. Your company operates in a perfectly competitive market. Your Manager told you that advertising can help you increase your sales in the short run. What kind of advertising campaign you will start for your product and how much gain is expected from an effective advertisement? Answer: 4. Suppose you are running a business and thinking to enter the monopoly market. As per your calculation, you can make a profit by keeping your product price 20% less than the monopolist. Explain, how the monopolist might react to stop you to enter the business? Answer: 5. The real GDP per capita of many countries such as China and Korea are greater than that of the US. Does this indicate that these countries will eventually overtake the US in terms of the growth rate of real GDP per capita? Explain.…
you've been learning about what makes a market perfectly competitive, how a firm in a perfectly competitive market makes profit-maximizing decisions, and how a perfectly competitive market moves towards equilibirium. But how applicable is this to real life? For this discussion, try to think of a market (for a product or service) that is perfectly competitive or very close to it. What characteristics of the market make it like perfect competition? Are there factors that keep it from being perfectly competitive? If so, what are they? How close do you think the firms in this market are to perfectly competitive firms in choosing equilibrium price and quantity?
Your company operates in a perfectly competitive market. You have been told that advertising can help you increase your sales in the short run. Would you create an aggressive advertising campaign for your product? in a paragraph explain Why or Why not?
You observed that in the long run, a profit-maximizing firm chose to exit a market. What can you infer about the profits of this firm?
16 5 Use the table below to answer questions about Christina's Christmas Wreaths. Christina operates in a perfectly competitive market for wreaths. Christina's Costs and Revenue Quantity Average Variable (wreaths) Cost (dollars) 5 $14.00 6 - 15.00 7 CALL/M 16.00 8 22.00 9 28.00 10 34.00 wreaths Average Total Cost (dollars) $24.00 23.00 23.00 28.00 34.00 39.00 $ Instructions: In part a, enter your answer as a whole number. In parts b and c, round your answers to two decimal places. a. What is the profit-maximizing level of output for Christina's Christmas Wreaths? Marginal Cost (dollars) $20.00 b. What is the profit per unit if the profit-maximizing level of output is produced? $ olo L c. What is the total economic profit generated by producing the profit-maximizing output? $ % Marginal Revenue (dollars) $63.00 63.00 63.00 63.00 63.00 63.00 22.00 23.00 BIEL 63.00 82.00 TAO 84.00
Why are sellers in perfect competition unable to increase prices?