Microeconomics,, 16th Canadian Edition

variable costs may choose to remain in operation for many years rather than shut down operations. Stockbyte/Getty Images 1 For f ...

Long-Run Equilibrium Because sooner or later firms exit when they are making losses and enter in pursuit of profits, we get the ...

Figure 9-11 Short-Run Versus Long-Run Profit Maximization for a Competitive Firm 3. Existing firms must not be earning profits. ...

A competitive firm that is not at the minimum point on its LRAC curve is not maximizing its long-run profits. A competitive firm ...

Figure 9-12 A Typical Competitive Firm When the Industry Is in Long- Run Equilibrium industry is in long-run equilibrium. Becaus ...

Changes in Technology Our discussion of firms’ long-run decisions has assumed that all firms in the industry have the same techn ...

Figure 9-13 Plants of Different Vintages in an Industry with Continuous Technological Progress What happens in a competitive ind ...

Industries subject to continuous technological change have three common characteristics. The first is that plants of different a ...

In industries with continuous technological improvement, low-cost plants will exist side by side with older high-cost plants. Th ...

Declining Industries What happens when a competitive industry in long-run equilibrium experiences a continual decrease in the de ...

age of equipment in use rises steadily. The untrained observer, seeing the industry’s plight, is likely to blame it on the old e ...

Summary ...

9.1 Market Structure and Firm Behaviour LO 1 A competitive market structure is one in which individual firms have no market powe ...

The Canadian Competition Act of LO 2 Four key assumptions of the theory of perfect competition are as follows: 1. All firms prod ...

9.3 Short-Run Decisions LO 3, 4 Any profit-maximizing firm will produce at a level of output at which (a) price is at least as g ...

9.4 Long-Run Decisions LO 5 In the long run, profits or losses will lead to firms’ entry into or exit out of the industry. This ...

Key Concepts Competitive behaviour and competitive market structure Perfect competition Price taking and a horizontal demand cur ...

Study Exercises MyLab Economics Make the grade with MyLab Economics™: All Study Exercises can be found on MyLab Economics™. You ...

Fill-in-the-Blank 1. Fill in the blanks to make the following statements correct. In addition to the key assumption that firms m ...

b. If the average variable cost of producing any given level of output exceeds the price at which it can be sold, then the firm ...