(Table: Cherry Farm) Use Table: Cherry Farm.Suppose there are 100 farms in this industry with identical cost curves,as shown in the table.At what price will the industry be in long-run equilibrium?

A) $2
B) $3
C) $4
D) $5

Question

Sussell Ruiz Ramirez · Accepted Answer

Final Answer : C, Explanation :  In long-run equilibrium, firms in a perfectly competitive market will produce at the point where price equals the minimum of the long-run average cost (LRAC). Without the specific table details, we typically assume that the LRAC is minimized where firms make zero economic profit, ensuring no new firms enter or exit the industry. Given the choices, $4 is the most likely answer as it suggests a scenario where firms cover all their costs, including the opportunity cost, without making extra profit that would attract new firms into the industry.

(Table: Cherry Farm) Use Table: Cherry Farm.Suppose there are 100 farms in this industry with identical cost curves,as shown in the table.At what price will the industry be in long-run equilibrium?

A) $2
B) $3
C) $4
D) $5

Definitions

Learning Objectives

Learning Objectives

Related questions

(Table: Cherry Farm) Use Table: Cherry Farm.Suppose there are 100 farms in this industry with identical cost curves,as shown in the table.At what price will the industry be in long-run equilibrium?A) $2B) $3C) $4D) $5

Definitions

Learning Objectives

Learning Objectives

Related questions

(Table: Cherry Farm) Use Table: Cherry Farm.Suppose there are 100 farms in this industry with identical cost curves,as shown in the table.At what price will the industry be in long-run equilibrium?

A) $2
B) $3
C) $4
D) $5