Lumen OHM Assessment

Question 1

The graph below shows cost curves for a firm operating in a perfectly competitive market.

Graphs with window x: 0 to 8, y: 0 to 27. Start Graph, Color black

x	y
0	18
1	18
2	18
3	18
4	18
5	18
6	18
7	18
8	18

Start Graph, Color blue

x	y
0	17
1	14
2	13
3	14
4	17
5	22
6	29
7	38

Start Graph, Color red

x	y
0	17
1	12
2	13
3	20
4	33

Start Graph, Color green

x	y
1	31
2	21.5
3	19.67
4	21.25
5	25.4
6	31.83
7	40.43

Label "Quantity of Avocados" at pixel coordinates (175,0).Label "Price of Avocados" at pixel coordinates (0,170).

Suppose that the equilibrium price is $18 (black line). This firm is earning

Losses
Profits
Zero Economic Profits (Break-even point)

Hint

Question 2

The graph below shows cost curves for a typical firm operating in a perfectly competitive market.

Graphs with window x: 0 to 8, y: 0 to 29. Start Graph, Color black

x	y
0	26.33
1	26.33
2	26.33
3	26.33
4	26.33
5	26.33
6	26.33
7	26.33
8	26.33

Start Graph, Color blue

x	y
0	19
1	16
2	15
3	16
4	19
5	24
6	31
7	40

Start Graph, Color red

x	y
0	19
1	14
2	15
3	22
4	35

Start Graph, Color green

x	y
1	35
2	24.5
3	22.33
4	23.75
5	27.8
6	34.17
7	42.71

Label "Quantity of Avocados" at pixel coordinates (175,0).Label "Price of Avocados" at pixel coordinates (0,170).

Suppose that the equilibrium price is $26.33 (black line). What will happen in this market in the long run?

Existing firms will exit.
New firms will enter.
No new entry/no exit.

Hint

Question 3

The graph below shows cost curves for a typical firm operating in a perfectly competitive market.

Graphs with window x: 0 to 8, y: 0 to 26. Start Graph, Color black

x	y
0	15.33
1	15.33
2	15.33
3	15.33
4	15.33
5	15.33
6	15.33
7	15.33
8	15.33

Start Graph, Color blue

x	y
0	16
1	13
2	12
3	13
4	16
5	21
6	28
7	37

Start Graph, Color red

x	y
0	16
1	11
2	12
3	19
4	32

Start Graph, Color green

x	y
1	29
2	20
3	18.33
4	20
5	24.2
6	30.67
7	39.29

Label "Quantity of Apples" at pixel coordinates (175,0).Label "Price of Apples" at pixel coordinates (0,170).

Suppose that the equilibrium price is $15.33 (black line). What will happen in this market in the long run?

No new entry/no exit.
Existing firms will exit.
New firms will enter.

Hint

Question 4

The graph below shows cost curves for a typical firm operating in a perfectly competitive market.

Graphs with window x: 0 to 8, y: 0 to 27. Start Graph, Color black

x	y
0	19.66
1	19.66
2	19.66
3	19.66
4	19.66
5	19.66
6	19.66
7	19.66
8	19.66

Start Graph, Color blue

x	y
0	17
1	14
2	13
3	14
4	17
5	22
6	29
7	38

Start Graph, Color red

x	y
0	17
1	12
2	13
3	20
4	33

Start Graph, Color green

x	y
1	31
2	21.5
3	19.67
4	21.25
5	25.4
6	31.83
7	40.43

Label "Quantity of Avocados" at pixel coordinates (175,0).Label "Price of Avocados" at pixel coordinates (0,170).

Suppose that the equilibrium price is $19.66478105462 (black line). What will happen in this market in the long run?

No new entry/no exit.
Existing firms will exit.
New firms will enter.

Hint

Question 5

The graph below shows cost curves for a typical firm operating in a perfectly competitive market.

Graphs with window x: 0 to 8, y: 0 to 23. Start Graph, Color black

x	y
0	12
1	12
2	12
3	12
4	12
5	12
6	12
7	12
8	12

Start Graph, Color blue

x	y
0	13
1	10
2	9
3	10
4	13
5	18
6	25
7	34

Start Graph, Color red

x	y
0	13
1	8
2	9
3	16
4	29

Start Graph, Color green

x	y
1	23
2	15.5
3	14.33
4	16.25
5	20.6
6	27.17

Label "Quantity of Textbooks" at pixel coordinates (175,0).Label "Price of Textbooks" at pixel coordinates (0,170).

Suppose that the equilibrium price is $12 (black line). What will happen in this market in the long run?

Existing firms will exit.
New firms will enter.
No new entry/no exit.

Hint