In a perfectly competitive market, what happens when the average total cost is greater than the market price?The firm shuts down immediatelyThe firm incurs an economic lossThe firm breaks evenThe firm earns an economic profit

If a perfectly competitive firm is facing a situation where the price of its product is lower than the average total cost, which of the following statements is true?Multiple ChoiceOther firms will want to enter the industry because of the economic profits generated by the firm.The firm may be earning some accounting profits, but less than what it could earn elsewhere.The firm is generating a loss, and if things are not expected to improve the firm will leave the industry.The firm may earn economic profits in the long run if it expands its plant in order to exploit economies of scale.

What is the condition for a firm to break-even in a perfectly competitive market?Price equals average variable costPrice equals marginal costPrice equals average total costPrice equals marginal revenue

In the long run, what would a firm operating in a perfectly competitive environment do if its average variable cost exceeds the price of its products?It will shut downIt will increase its outputIt will decrease its outputIt will continue to function producing the same level of output

In perfect competition, if the market price of the product is initially higher than the minimum average total cost faced by the firms, thenMultiple Choicesome firms will exit the industry and the industry supply will decrease.other firms will enter the industry and the industry supply will increase.some firms will exit the industry and the industry supply will increase.other firms will enter the industry and the industry supply will decrease.

33.The firm under perfect competition will be in short-run equilibrium, when:  A. Rising marginal cost is equal to the minimum average cost  B. Marginal revenue is equal to rising marginal cost  C. Average revenue is equal to average cost  D. Marginal revenue is equal to the falling marginal cost