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(Figure: Cost Curves for Corn Producers) Use Figure: Cost Curves for Corn Producers.The market for corn is perfectly competitive.If the price of a bushel of corn is $14,in the short run,the farmer will produce _____ of corn and earn an economic _____ equal to _____.
A) 4 bushels;profit;$0
B) 4 bushels;profit;just less than $80 per bushel
C) 2 bushels;profit;$0
D) 2 bushels;loss;just more than $80 per bushel
Economic Profit
The net outcome of subtracting all expenses, both overt and hidden, from a corporation's aggregate earnings.
Short Run
A period during which at least one of a firm's inputs is fixed, limiting the firm's ability to adjust to changes in market demand or supply.
Quantity
The amount or number of a material or immaterial good that is considered as a unit or an aggregate.
- Differentiate among economic profit, total revenue, and total cost within the framework of perfect competition.
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Learning Objectives
- Differentiate among economic profit, total revenue, and total cost within the framework of perfect competition.
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