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worty [1.4K]
1 year ago
7

Does a competitive firm’s price equal its marginal cost in the short run, in the long run, or both? explain

Business
1 answer:
DerKrebs [107]1 year ago
5 0

The price of a firm is equal to its marginal cost in both the short and long run. In both the short and long run, price equals marginal revenue. Firms should increase output as long as marginal revenue exceeds marginal cost, and reduce output if marginal revenue is less than marginal cost.

Note that when we are in long-term equilibrium, we are also in short-term equilibrium. In the long run, P = min(ATC), and the entering firm chooses the set with the lowest ATC. The MC curve intersects ATC at min(ATC), so the same quantity has a price equal to MC.

For a perfect competitor, marginal return equals price and average return. This means that the firm's marginal cost curve is a continuous supply curve with values ​​greater than the average variable cost. If the price falls below the average variable cost, the company will be closed.

In a perfectly competitive market, price equals marginal cost in both the short and long run.

Learn more about the firm here brainly.com/question/15130516

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You founded your own firm three years ago. You initially contributed $200,000 of your own money and in return you received 2 mil
Aneli [31]

Answer:

$5 million

Explanation:

Calculation for the post-money valuation of your shares

First step is to calculate the total shares outstanding after the venture capitalist's investment:

Total shares = 2 million shares + 1 million shares + 4 million shares

Total shares = 7 million shares

Second step is to calculate the Amount paid by venture capitalist

Using this formula

Amount paid by venture capitalist = Total value / Number of shares purchased

Let plug in the formula

Amount paid by venture capitalist = $5 million / 4 million shares

Amount paid by venture capitalist = $1.25 per share

Last step is to calculate the post-money valuation

Using this formula

Post-money valuation = Amount paid by venture capitalist * Shares subscribed

Let plug in the formula

Post-money valuation = $1.25 * 4 million shares

Post-money valuation = $5 million

Therefore After the venture capitalist's investment, the post-money valuation of your shares is closest to$5 million

5 0
3 years ago
According to a candy company, packages of a certain candy contain 16% orange candies. Suppose we examine 200 random candies
Artyom0805 [142]

Answer:

A. We should expect of the candies in the sample to be orange.(Type an integer or a decimal.)

7 0
3 years ago
Blue Spruce Corp. purchased equipment for $17400 on December 1. It is estimated that annual depreciation on the computer will be
Paul [167]

Answer:

a. debit Depreciation Expense                                    $ 290

             credit Accumulated Depreciation                                 $ 290

Explanation:

The depreciation has to be calculated for the month of December i.e one month.

The annual depreciation per the question is $ 3,480 so the monthly depreciation expense is $ 290.

The depreciation expense account is debited, and the credit is to accumulated depreciation account. The equipment account is not credited directly, This is to show the costs and the accumulated depreciation separately.

The equipment on the balance sheet is shown as net of accumulated depreciation.

8 0
4 years ago
Making selection decisions by subjectively combining sources of information according to the general impression of the hiring sp
adelina 88 [10]
This is often referred to as the clinical approach. The clinical approach is also known as the threshold approach to clinical decision making. This approach combines rational and quantitative information with a general approach to decision making. In this situation, say you were hiring a new employee, a person using the clinical approach would look at their resume in how they match up with numbers and on paper to the candidate their looking for but also who they are as a person in a general sense. 
7 0
3 years ago
Which of the following is not true regarding economic exposure? a. The impact of a change in the local currency on inflow and ou
Natali [406]

Answer:

Option A The impact of a change in the local currency on inflow and outflow variables can sometimes be indirect and therefore different from what is expected.

Explanation:

The reason is that the changes in the currency exchange rate in which the company receives the payment and is also not a home currency, such risk exposure is known as economic exposure. So the only option that correct here is option A.

Option B is incorrect because depreciation is non cash item and it is not exposed to currency fluctuations.

Option C and D are also incorrect because domestic firms don't face any economic exposure.

8 0
4 years ago
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