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18 Cards in this Set

  • Front
  • Back
Pure competition
involves a very large number of firms producing a standarized product. New firms can enter or exit the industry very easily
Pure monopoly
a market structure in which one firm is the sole seller of a product or service. Since the entry of additional firms is blocked, one firm constitutes the entire industry. Because the monopolist produces a unique product, it makes no effort to differentiate its product
Monopolistic competition
characterized by a relatiely large number of sellers producing differentiated products.
Nonprice competition
a selling strategy in which one firm tries to distinguish its product or service from all competing products on the basis of attributes like design and workmanship
Oligopoly
involves only a few sellers of a standardization or differentiated productl each firm is affected by the decisions of its rivals, and must take those decisions into account in determining its own price and output
Price taker
a competitive firm is a ______________: it cannot change market price; it can only adjust to it.
Average revenue
the revenue per unit
Total revenue
when you multiply the price by the corresponding quantity the firm can sell
marginal revenue
the change in total revneue that results from selling one more unit of output
Break even point
an output at which a firm makes aformal profit but not an economic profit
the MR=MC Rule
the Profit Maximizing Guide: MR = Marginal Revenue/MC = Marginal Cost. They are only equal at a fractional level of output
Short-Run Supply Curve
the soli segment of the marginal-cost curve, MC. The amount of output the firm will supply at ecah price in a series of prices
Long-Run Supply Curve
changes in the number of firms in the industry will have on costs of the individual firms in the industry
Constant-cost industry
industry expansion of contraction will not affect resource prices and therefore production costs
Increasing-cost industries
firms ATC curves shift upward as the industry expands and downwards as the industry contracts
Productive efficiency
requires that goods be produced in the least costly way; P= Minimum ATC
Consumer Surplus
the difference between the maximum prices that consumers are willing to pay for a product and th market price of that product
Producer Surplus
the difference between the minimum prices that producers are willing to acept for a product and the market price of the product