Suppose There Are 200 Firms in a Perfectly Competitive Market

question 131

Multiple Choice

Suppose there are 200 firms in a perfectly competitive market and each maximizes profit at 120 units of output when market price is $5.00 per unit. One of the points on the market supply curve must be at:

• A) Price = $5 and Quantity supplied = 320.
• B) Price = $5 and Quantity supplied = 24,000.
• C) Price = $1,000 and Quantity supplied = 320.
• D) Price = $1,000 and Quantity supplied = 24,000.

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Definitions:

Method of Loci

A mnemonic technique that involves imagining placing items to be remembered in specific locations within a familiar place.

Von Restorff Effect

The tendency to remember unusual or distinctive items more easily than common items.

Working Memory

A cognitive system with a limited capacity that is responsible for temporarily holding information available for processing tasks such as reasoning and comprehension.

Unrelated Tasks

Tasks or activities that have no direct connection or relevance to each other.