Exam (elaborations)
ECS2601 Assignment 4 Semester 1 2023
- Institution
- University Of South Africa
ECS2601 Assignment 4 Semester 1 2023
[Show more]
Content preview
ECS2601Assignment 4
Semester 1
2023
[School]
[Course title]
, ECS2601 Assignment 4 Semester 1 2023
1. In the short run, a perfectly competitive firm earning positive profit is …
In the short run, a perfectly competitive firm earning positive profit is above its
average total cost (ATC). This is because profit is calculated as the difference
between total revenue and total cost. If the firm's total revenue exceeds its
total cost, it is earning a profit. Since average total cost represents the cost
per unit of output, if the firm is earning a profit, it means that the price it
receives for each unit of output is higher than the average cost of producing
that unit.
a. at the minimum of its ATC.
b. on the upward sloping portion of its ATC.
c. on the downward sloping portion of its ATC.
d. above its ATC.
2. If current output is less than the profit-maximising output, then the next unit
produced will…
If the current output is less than the profit-maximizing output, producing an
additional unit will increase revenue more than it increases cost. This is
because the profit-maximizing output level is determined by comparing
marginal revenue (the additional revenue from selling one more unit) with
marginal cost (the additional cost of producing one more unit). If the current
output is below the profit-maximizing level, producing an additional unit will
increase revenue by more than it increases cost, leading to an increase in
profit.
a. increase revenue more than it increases cost.
b. decrease profit.
c. increase revenue without increasing cost.
d. increase cost more than it increases revenue.
3. Which of the following statements is correct regarding the perfectly
competitive industry?
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller reinah44. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R46,37. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
80364 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy summaries for 14 years now