Production, Cost, and the Perfect Competition Model

The firm's producer surplus remains unchanged.

The firm's producer surplus becomes zero.

The firm experiences a positive producer surplus.

The firm's producer surplus decreases.

The firm experiences a negative producer surplus.

The firm's producer surplus remains unchanged.

The firm's producer surplus increases.

The firm's producer surplus becomes zero.

Consumer demand is highly elastic making collusive pricing ineffective as customers readily switch to non-colluding substitutes.

Government regulations strictly enforce anti-collusion laws resulting in severe penalties if caught.

The introduction of high-tech innovation reduces costs significantly for both competing firms simultaneously allowing for mutual benefits from shared technology.

A few dominant firms agree on limited market-share allocation resulting in higher collective profits through reduced competition.

Market demand is static, and all firms earn normal profits.

Current firms are earning economic profits.

There's perfect information available about technology but no economic profits.

Existing firms benefit from economies of scale while new entrants do not.

The firm goes out of business completely.

The firm reduces its production level.

The firm stops producing any quantity.

The firm increases its market share.

Oligopoly

Pure Monopoly

Monopolistic Competition

Perfect Competition

Influx of new firms entering market due to government support implied by price ceilings.

No change in number of firms since price ceilings result in equilibrium quantities being traded eventually.

Firms exit when persistent losses occur because they're unable to cover operating costs at artificial low selling prices set by price ceilings.

More firms enter due to increased consumer demand sparked by lower prices resulting from price ceilings.

It necessitates an immediate shutdown of production as marginal costs exceed marginal revenues.

It would lead to an immediate decrease in quantity of output produced because marginal cost rises.

It would not affect the quantity of output produced but may reduce overall profitability.

It would trigger an increase in output produced as firms try to spread out fixed costs over more units.

There is movement along the supply curve, reducing the equilibrium price without changing the supply or demand.

The demand curve for goods Y shifts right, resulting in a higher equilibrium price and higher quantity demanded.

The supply curve for goods Y shifts right, leading to a lower equilibrium price but increased equilibrium quantity.

There is movement along the demand curve due to higher income levels, increasing the quantity and price of goods Y sold.

Producer surplus rises substantially due to increased sales volume outweighing minor price reductions per unit sold.

The firm's total profit decreases because it sells additional units at a lower price than their marginal cost of production.

Consumer surplus increases significantly as more consumers can now afford the product at lower prices.

Total revenue remains unchanged while costs increase slightly resulting in small changes in overall profit.