In a Perfectly Competitive Industry - Assuming the Short-Run Average

question 123

Multiple Choice

In a perfectly competitive industry - assuming the short-run average total cost increases as the output of the industry expands - the industry supply curve,in the long run,will:

• A)first have a positive slope and then a negative slope.
• B)have a negative slope.
• C)be perfectly horizontal.
• D)be perfectly vertical.
• E)have a positive slope.

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Definitions:

Estimated Ending Inventory

An approximation of the value or quantity of inventory that a company has on hand at the end of an accounting period, calculated for planning or valuation purposes.

Gross Profit Rate

The percentage of revenue that exceeds the cost of goods sold, indicating how efficiently a company uses its resources to produce goods.

Ending Inventory

The overall worth of items ready for sale at the end of a fiscal period.

Net Income

The total earnings of a company after subtracting all expenses, taxes, and costs from its total revenues.