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  • Lecture Sept 30

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    vivianguo23
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    The document summarizes key concepts about competitive markets and profit maximization. It notes that in a perfectly competitive market, there are many small firms, free entry and exit into the market, and goods are homogeneous. Under these conditions, no individual firm can influence the market price and firms will maximize profit where price equals marginal cost. The document also recaps that the number of firms in a market determines whether it is competitive or allows for monopoly profits, and that profit is calculated as total revenue minus total costs.

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    Lecture Sept 30.docx

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    The document summarizes key concepts about competitive markets and profit maximization. It notes that in a perfectly competitive market, there are many small firms, free entry and exit into the market, and goods are homogeneous. Under these conditions, no individual firm can influence the market price and firms will maximize profit where price equals marginal cost. The document also recaps that the number of firms in a market determines whether it is competitive or allows for monopoly profits, and that profit is calculated as total revenue minus total costs.

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    Attribution Non-Commercial (BY-NC)
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    5 просмотров1 страница

    Lecture Sept 30

    Загружено:

    vivianguo23
    The document summarizes key concepts about competitive markets and profit maximization. It notes that in a perfectly competitive market, there are many small firms, free entry and exit into the market, and goods are homogeneous. Under these conditions, no individual firm can influence the market price and firms will maximize profit where price equals marginal cost. The document also recaps that the number of firms in a market determines whether it is competitive or allows for monopoly profits, and that profit is calculated as total revenue minus total costs.

    Авторское право:

    Attribution Non-Commercial (BY-NC)
    Скачайте в формате DOCX, PDF, TXT или читайте онлайн в Scribd
    Отметить как неприемлемый контент
    из 1

    Recap: Last Costs Today: Competitive markets Profit making is related to market structure 1 firm = monopoly profit opportunity

    nity Many firms = a lot of competition no profit o # of firms is high o Free entry o No differentiation (homogeneous) o Wheat, corn A perfect competitive market is a situation in which a firm is a very small entity. o My actions affect your profitability o Firms are unable to affect the market price Profits in competitive markets: o Profit: total revenue total cost o Maximize profit o Total revenue: Price x Quantity o Total cost: VC + FC

    Check lecture notes: Profit is maximized where MR = MC In competitive markets, profits are maximized at P = MC.

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