Answer:
continue producing 1000 units
Explanation:
A perfect competition is characterised by many buyers and sellers of homogeneous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.
In the long run, firms earn zero economic profit. If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.
Also, if in the short run, firms are earning economic loss, in the long run, firms would exit the industry until economic profit falls to zero.
Profit is maximised where price is equal to marginal cost
the firm already maximises profit / loss because price ($2.50) is equal to marginal cost ($2.50). So, the firm should continue production at 1000 units
Answer:
1. Economics - The social science concerned with how individuals, institutions, and society make optimal (best) choices under conditions of scarcity.
2. Opportunity cost - The next-best thing that must be forgone in order to produce one more unit of a given product.
3. Marginal analysis - Making choices based on comparing marginal benefits with marginal costs.
4. Utility - The pleasure, happiness, or satisfaction obtained from consuming a good or service.
Answer:
Enterprise is another word for a for-profit business or company, but it is most often associated with entrepreneurial ventures. People who have entrepreneurial success are often referred to as “enterprising.” There are many forms of legal enterprises, with the most common in the U.S.
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Answer:
1) Tires Ford buys to put on a car. - Included in GDP assuming that the tires are new, and produced domestically.
2) A used tire you buy for your personal car. - Not included because purchases of used goods are not part of GDP (they were produced in previous years, hence, were already calculated in a previous GDP).
3) A new tire you buy for your personal car. - Included in GDP because the tires are new.
4) The value of a car produced in the United States and exported to England. - Included in the U.S. GDP and excluded from the British GDP.
5) The profit earned in 2004 sale of a house you purchased in 2001. - Not a part of GDP because the house was built in 2001, thus, its value is already part of the 2001 GDP.
6) The commission earned by an employment counselor when she locates a job for a client. - Commission is included in wages, one of the elements of GDP, therefore, they are included.