All categories

2 years ago

Both perfectly competitive and monopolistically competitive firms charge a price equal to marginal cost.

Business

1 answer:

natita [175]2 years ago

6 0

Both perfectly competitive and monopolistically competitive firms charge a price equal to marginal cost True

What is a perfect competitive firm?

A perfectly competitive firm is a price taker, which means that it must accept the equilibrium price at which it sells goods. If a perfectly competitive firm attempts to charge even a tiny amount more than the market price, it will be unable to make any sales.

What is the advantage of perfect competition?

Markets experiencing perfect competition have very low barriers to entry. The advantage is for both customers and the total industry. There will be new entrants in the market which brings healthy competition to the industry. Also, consumers will not be a risk when a few companies get together and increase their prices.

What is monopolistic competition:

Monopolistic competition exists when many companies offer competing products or services that are similar, but not perfect, substitutes. The barriers to entry in a monopolistic competitive industry are low, and the decisions of any one firm do not directly affect its competitors.

What is monopolistic competition characteristics?

Monopolistically competitive markets have the following characteristics: There are many producers and many consumers in the market, and no business has total control over the market price. Consumers perceive that there are non-price differences among the competitors' products.

Learn more perfectly competition and monopolistic competetion:

brainly.com/question/20379276

#SPJ4

You might be interested in

According to the textbook readings, gross margin results from _____________ 1) Subtracting expenses from profit 2) Subtracting e

sveticcg [70]

Answer:

The answer is 3. Subtracting cost of goods sold from net sales

Explanation:

Gross margin or Gross profit is the profit a business earn after deducting cost associated with making the goods from net sales(Net sales - Cost of goods sold or Cost of sales)

To calculate cost of goods sold - opening inventory/stock plus purchases minus closing inventory/stock.

The attached file also support this statement.

7 0

3 years ago

Read 2 more answers

On January 1, 2021, Algerian Delivery had 100,000 shares of common stock outstanding. The following transactions occurred during

defon

Answer:

Algerian Delivery's basic earnings per share for the year ended December 31, 2021 is $3.01

Explanation:

In order to calculate Algerian Delivery's basic earnings per share for the year ended December 31, 2021 we would have to make first the following calculations:

Net Income = $298,750

Calculation of Weighted Average of Number of Equity Shares:

Outstanding on Jan 1 = 100,000*12/12 = 100,000

Less: Treasury Stock 3,100*10/12 = (2,583)

Sold Treasury Shares 3,100*3/12 = 775

New Shares Sold 12100*1/12 = 1,008

Therefore, Weighted Average of Equity Shares during the year = 100,000 - 2,583 + 775 + 1,008 =99,200

Therefore, Basic Earnings per Share = Net Income/Weighted Average of Equity Shares outstanding during the year

= $298,750/99,200 = $3.01

Algerian Delivery's basic earnings per share for the year ended December 31, 2021 is $3.01

6 0

3 years ago

What are some arguments in favor of raising the minimum wage? On the other hand, what are some arguments against raising the min

Ede4ka [16]

Answer:

Explanation:

The main argument in favor regarding increasing minimum wage is that a higher wage will result into an increase in the standard of living of the people. Furthermore, a rise in the minimum wage can help in lifting people out I poverty. Due to higher wages and salaries, workers will have more money to cater for their families and meet their needs. Lastly, an increase in the minimum wage means that the government can reduce its expenditures on helping the low income earners and can therefore invest the money in other critical sectors of the economy.

The arguments against raising the minimum wage is that it can lead to inflation. Inflation in the rise in the price for goods and services. When there's an increase in minimum wage, sellers may increase the price of goods as there'll be more money to spend by households. Also, it can lead to losses of jobs as employersay have to cut down cost on order to be able to increase the wages of some workers and thereby may result in some workers being laid off.

Minimum wages lead to the reduction in the entry-level jobs that are available, and reduces the change of entry level graduates to get training, and lifetime income. According to Economists, minimum wages will result into decrease in the employment opportunities that are available for the youths and thereby create unemployment. Potential employees will miss out on the training that should have been done at the initial stage one is entering an organization.

3 0

3 years ago

Durable goods $3,000 Services 6,000 Business purchases of capital goods 400 Fixed investment 850 Exports 600 Imports 800 Nondura

ASHA 777 [7]

Answer:

$9,700

Explanation:

The computation of the consumption is shown below;

= Durable goods + Services + Non-durable goods

= $3,000 + $6,000 + $700

= $9,700

We simply added the durable goods, services and the non-durable goods so that the consumption could be come

Hence, the consumption is $9,700

Therefore the same is to be considered

6 0

3 years ago

Determine the amount of producer surplus generated in the following situation. SoHee advertises her car for sale in the usedca

abruzzese [7]

Answer:

The answer is: $0

Explanation:

Producer surplus is the difference between the maximum price a suppler is willing and able to sell its product and the price of the product.

SoHee was willing to sell her car for at least $1,500, but she wasn't able to do so since the fair market price is $1,200. So, producer surplus is $0.

6 0

3 years ago