Demonstrate Graphically and Explain Verbally the Case of a Constant-Cost

question 33

Essay

Demonstrate graphically and explain verbally the case of a constant-cost industry in a perfectly competitive market. Draw both a firm and a market diagram. HINT: The long-run market supply curve in your diagram should be perfectly elastic (i.e., horizontal).

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Definitions:

Blisspoint

The optimal level of satisfaction or pleasure for a consumer, often used in food industry to describe the perfect balance of saltiness, sweetness, and fattiness.

Contingent Responses

Behaviors or actions that are performed in response to specific conditions or stimuli, often depending on the presence or absence of certain factors.

Reinforcing Activities

Activities or actions that increase the likelihood of a behavior being repeated by providing a positive outcome or reward.

Premack's Probability-Differential Theory

A theory that suggests more probable behaviors will reinforce less probable behaviors.