Consider an industry with three profit- maximizing firms producing identical soccer jerseys.At their current levels of output,Firm A has a MC of $22,Firm B has a MC of $26,and Firm C has a MC of $27.Each firm is equating price and marginal cost and is operating on their LRAC curve.Which of the following statements is definitely true?
A) Each firm and the industry are productively efficient.
B) Each firm and the industry are allocatively efficient.
C) The industry is productively efficient but each firm is not.
D) Each firm is productively efficient but the industry is not.
E) Each firm is allocatively efficient but the industry is not.
Correct Answer:
Verified
Q103: If a perfectly competitive industry was suddenly
Q104: The diagram below shows cost and revenue
Q105: A regulated monopoly that faces rising long-
Q106: The diagram below shows supply,demand,and quantity exchanged
Q107: The Canadian economy is achieving allocative efficiency
Q109: FIGURE 12- 1 Consider three firms,A,B and
Q110: The deadweight loss of monopoly is
A)any negative
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents