The Following Table Applies to a Purely Competitive Industry Composed

question 26

Multiple Choice

The following table applies to a purely competitive industry composed of 100 identical firms. $\begin{array}{lcl}Quantity&&Quantity\\Demanded &Price &Supplied\\\hline400,000 & \$ 5 & 800,000 \\500,000 & 4 & 700,000 \\600,000 & 3 & 600,000 \\700,000 & 2 & 500,000 \\800,000 & 1 & 400,000\end{array}$ Refer to the table.If each of the 100 firms in the industry is maximizing its profit and earning only a normal profit,each must have a total cost of:

• A) $18,000.
• B) $20,000.
• C) $22,000.
• D) $14,000.

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Definitions:

Informational Power

Influence derived from possessing knowledge or information that others perceive as valuable or essential.

Positive Reference Group

A group that individuals aspire to or identify with, often influencing their attitudes, behaviors, and perceptions of self.

Membership Group

Kelley’s term for a group to which we belong by some objective external criterion.

Developing Norms

Rules or standards of behavior that are evolving or being established within a group or society.