Which of the following statements is correct?
a. In the long run, both perfectly competitive firms and monopolistically competitive firms operate with excess capacity.
b. A firm operates with excess capacity when, in the long run, its level of output is below the efficient scale.
c. For any firm, efficient scale is the level of output at which the average-total-cost curve is tangent to the demand curve.
d. All of the above are correct.
b
You might also like to view...
M2 includes:
a. Any financial assets that can be spent on real goods and services. b. Checking accounts plus Deposits at the central bank. c. Currency in circulation + Reserves of financial intermediaries (e.g., banks) + Checking Accounts + Near Money. d. Currency in circulation + Checking Accounts e. Currency in circulation + Checking Accounts + Near Money.
The difference between what producers receive at the market clearing price and the total amount that they would have been willing to accept for the total quantity produced in a market is called
A. producer surplus. B. market surplus. C. excess demand. D. production excess.