1. Perfect Competition name: Perfect Competitors product: doodle devices (pencils, erasers, etc…)

3. Cost, Revenue, and Profits

4. Pros and Cons

6. Profits are made (normal, supernormal)

7. Losses can be made

8. Shut down price and Break even prices exist

10. How we determine cost, revenue, profit Revenue is the income a firm obtains from the sales of its goods or services. MC $ AR = D = MR Output (q)

11. How we determine cost, revenue, profit Normal Profit is the level of profit that is required for a firm to keep the resources they are using in their current use. AC MC $ AR = D = MR = AC Output (q)

12. How we determine cost, revenue, profit AC MC $ LOSS AR = D = MR = AC Output (q)

13. How we determine cost, revenue, profit MC $ AC AR = D = MR = AC ABNORMAL PROFIT Output (q)

15. One firm cannot make more money than others.

17. There is a large number of buyers and sellers. Entering the market is cheap. There are no exit or entry barriers Buyers can switch easily from one seller to another. Firms aim to maximize profits. Why We Are Successful

18. Which Brings Me To My Conclusion… Firm Industry $ $ AC S MC AR = D = MR = AC D E Output (q) Quantity

19. When there is a shortage… Firm Industry S1 $ $ AC S MC LOSS AR = D = MR = AC D E Output (q) Quantity

20. When there is an abnormal profit… Firm Industry $ $ AC S MC S1 AR = D = MR = AC ABNORMAL D E Output (q) Quantity

21. Perfect Competition is the best. Effective Always at equilibrium We are successful Conclusion: Perfect Competition