Pasar output pada pasar persaingan sempurna jangka pendek dan panjang

Summary

This transcript delves into the concept of perfect competition in both the short and long run, highlighting key economic principles such as marginal revenue (MR), marginal cost (MC), and average cost (AC). It explains how producers maximize profits when MR equals MC and explores the effects of price changes on profitability. Real-life examples, such as the poultry industry during the COVID-19 pandemic and the evolution of prepaid mobile phone cards in Indonesia, illustrate the theory. The session provides insights into short-term losses and long-term equilibrium, emphasizing the challenges faced by producers in a competitive market.

Takeaways

• 😀 Understanding perfect competition in the short run involves examining how prices (P), marginal revenue (MR), and marginal cost (MC) interact to determine maximum profit for producers.
• 😀 In the short run, when the price equals average cost (AC), producers do not earn a profit, but simply break even, which is the point where price equals average cost.
• 😀 If the price falls below average variable cost (AVC), producers cannot cover their variable costs and will experience losses, eventually leading to shutdown in the long run.
• 😀 Producers can continue operations in the short run even if they are losing money, as long as they can cover their variable costs, but this is only sustainable until prices rise again.
• 😀 A 'shutdown point' occurs when a firm can no longer cover its average fixed costs (AFC) and is forced to exit the market.
• 😀 The COVID-19 pandemic created a real-world example of industries, like poultry farming, where falling prices forced producers to operate at a loss in the short term while hoping for a price recovery.
• 😀 In the long run, the market in perfect competition reaches an equilibrium where price (P) equals marginal cost (MC) and average cost (AC), ensuring no economic profit for firms.
• 😀 The shift from high prices and limited market supply to low prices with many competitors is characteristic of perfect competition as firms enter and exit the market based on profitability.
• 😀 The case of prepaid mobile phone cards in Indonesia illustrates the transition from high prices in a monopoly to low, nearly uniform prices in a competitive market, where price equals average cost (P=AC).
• 😀 Long-term success in a perfectly competitive market is driven by firms' ability to adjust to changing supply and demand, leading to price stabilization and no economic profit over time.

Q & A

What is the concept of perfect competition in the short run?

In the short run, a perfect competition market structure is characterized by many firms producing identical products, with prices determined by market forces. The firms are price takers, meaning they cannot set their own prices but must accept the market price.

How does the marginal revenue (MR) curve behave in a perfectly competitive market?

In a perfectly competitive market, the marginal revenue (MR) curve is horizontal, meaning that the firm’s revenue increases at a constant rate with each additional unit sold. This is because the firm is a price taker and must sell its product at the market price.

What is the relationship between price (P), marginal revenue (MR), and average revenue (AR) in perfect competition?

In perfect competition, price (P), marginal revenue (MR), and average revenue (AR) are all equal. This is because each additional unit sold brings in the same amount of revenue, and the price does not change with the level of output.

What happens when the price equals average cost (AC) in the short run?

When the price equals the average cost (AC) in the short run, the firm breaks even, meaning it neither earns a profit nor incurs a loss. The firm is covering both its fixed and variable costs.

What occurs when the price falls below average cost (AC) in the short run?

When the price falls below average cost (AC) in the short run, the firm incurs a loss. This happens because the revenue from each unit sold is insufficient to cover the average total cost of production.

What is the shutdown point in a perfectly competitive market?

The shutdown point occurs when the price equals the average variable cost (AVC). At this point, the firm is not covering its variable costs and should temporarily cease production to minimize losses in the short run.

How does a firm's ability to continue operating depend on price in the short run?

In the short run, a firm may continue operating as long as the price covers its average variable cost (AVC), even if it is making a loss. The firm hopes that prices will rise in the future to cover its total costs and allow it to make a profit.

What is the role of fixed costs in a firm's decision to continue operating in the short run?

Fixed costs do not affect the firm's decision to continue operating in the short run. A firm will continue operating as long as it can cover its variable costs, even if it cannot cover all of its fixed costs. The fixed costs are incurred regardless of production.

How does the long run differ from the short run in a perfectly competitive market?

In the long run, firms in a perfectly competitive market can enter or exit the industry, and there is no distinction between fixed and variable costs. In the long run, firms earn zero economic profit because the price adjusts to the point where price equals both marginal cost (MC) and average cost (AC).

What is an example of a real-life scenario where a firm faces losses in the short run but continues to operate?

An example is the poultry industry during the COVID-19 pandemic, where chicken farmers faced significant price drops, causing losses. Despite these losses, they continued operating in the short run, hoping that market conditions would improve and allow them to recover.