Y2 14) Perfect Competition - Shutdown Condition

Y2 14) Perfect Competition - Shutdown Condition. Video covering the shutdown condition of perfect competition. When losses are being made in the short run in perfect competition which firms will stay and which firms will leave i.e. which perfect competition firms will shutdown?
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[@realFriedrichHayek]

These videos are why grade boundries are so high. Great Video :)

[@callumjsc7244]

What exam board are you? They seem V reasonable for Edexcel with about 80% being an A* in old spec and hopefully the same or even lower for new spec :)

[@kaibaing4288]

How can I get Edexcel books.Pdf is preferable Ps:not from England

[@realFriedrichHayek]

@@kaibaing4288 lmao... did you ask a question on a 3 year old comment of mine? Try z-lib.org. just make sure you have a good anti-virus

[@kaibaing4288]

@@realFriedrichHayek ya your dp looked like the one kept by an intellectual Ty for the quick reply. The books in my curriculum are very narrow,it's fun to study in depth.

[@kaibaing4288]

@@realFriedrichHayek Mate can you suggest me some good micro economics books. Ty for the reply🙏.

[@springkonion]

thank you for this!!!!!!! my lecturer does completely nothing, you just saved my grades.

[@khromburst6671]

Firstly, I'd like to thank you for making these videos - they're a great revision resource. Is there any chance you could do a video on fiscal rules and the effectiveness of them?

[@futuristicPastgirl]

kHromBurst check his macro side

[@xsomili5501]

thank you. by thte end of the vid, i could easily draw out the graphs for each situation. ur vids are the best

[@nas4331]

We should also take into consideration non Monterey costs incurred by firms, that total costs= monetary cost + opportunity cost, if opportunity cost is high then firms would tend to leave the market even if production at a point above the AVC curve.

[@muhammadammrfitri9035]

thank you, its really helpful and easy to understand

[@Naraluxury]

Thank you very much your videos are really helpful I must admit I never understand my teacher I normally watch your videos and understand everything quickly and thank you again for helping me pass my exams I pass from u to a B now I hope to get an A thank you very much my teacher is impressed as he knows am doing really good in class now.

[@noahkamocha3582]

😂😅😂 your teacher is now reading your comment 😂😅

[@rrahmaarifa4571]

GODBLESS MR DAL

[@leiyos]

This is very insightful. Thank you for the upload

[@FittSINGH]

well explained brother keep it up

[@Joseph-ms3iq]

I fucking love your videos keep it up man!!

[@anshugandhi9286]

Well explained. Thanks✨

[@JH-hf8pg]

Thank you for being so committed to uploading because I find your videos incredibly useful. One question however (apologies if you answered this and I missed it) How is it possible that firms can have different AVC curves if all firms operate with perfect knowledge and technology? I would have assumed they'd all use the best capital and techniques and so would have the same curves?

[@realFriedrichHayek]

*AVC are the variable costs that a firm has. In the short-run* (where firms are making SNP or losses in perfect competition),*firms may have employed more people as they can afford that. This would increase the money spent on wages. More firms enter the market because they see profits to be gained, the market price* (industry price - where supply = demand decreases. From an increase in supply) *decreases which means that some firms will have more a larger TVC than others. However, the assumption made is that firms that were in the market first were able to get to that point.* *Hope that helps :)*

[@JH-hf8pg]

Thanks a lot Hayek, I'm a big fan of yours!

[@realFriedrichHayek]

Thanks!

[@user-gx6zw3ws4x]

@@realFriedrichHayek how would they increase supply if demand decreases? Wouldn't that demotivate firms and hence cause them to decrease their supply?

[@shubhankarkulkarni7667]

Legend

[@austinwachira5185]

God Sent! Thanks Dal! 😁

[@ric6383]

Many thanks.

[@Axle_Tavish]

What I have learnt from this video: 1. economics 2. This guy snaps fingers very loud.

[@aroosaroos4343]

Thank you so much Sir 😊

[@imranurrahman1693]

thanks

[@tylaevans3716]

wow- just wow

[@zk_011]

so helpful

[@ChickenTikkaKid]

Hi Mr Dal, Could you make a video explaining the policies such as monetary, fiscal and supply side for Y1 AS Level students please, Thanks in advance

[@EconplusDal]

All done and clearly posted in my Year 1 Macro Playlist. Check it out :)

[@ChickenTikkaKid]

EconplusDal Great, Thank you! Your videos have really helped me

[@mphomotsamai7954]

You are the best

[@aatud9586]

Just wondering, but wouldn't u consider existence of fixed costs to be a barrier of entry/exit as they would be sunk costs especially if these fixed FOPs can't be moved. This would oppose the definition of perfect competition having no barriers of entry/exit

[@fariii7]

Have you found an answer to this yet?

[@aatud9586]

@@fariii7 well, not exactly, I'm not sure as to whether to ignore this contradiction between the model's idea of having no barriers of entry, and it's reality of it inevitably having ones in the form of fixed costs. Because as explained in my initial comment even in PCM there are fixed costs, which can work as a barrier of entry, also leading to sunk cost, which works as barrier of exit. It's one large point of critique for PCM's theory. But in general PCM is only hypothetical and in reality no market can ever be perfectly competitive. So I assume it's better to ignore this contradiction for a theory that is fully hypothetical to begin with. Hope this answered ur question in some ways. I'm not an expert on this topic tho so take what I said with a pinch of salt

[@fariii7]

@@aatud9586 Thank you for your insight, it is very appreciated. Good luck with your exams!

[@user-cn6zh2hg2l]

Thankyouu soo muchhhhhhh

[@Asyphinix]

LOOOOOOOOL this came up. Who did this 15 marker?

[@azfaraltaf5971]

i have my mock tomorrow and im just looking at the past papers lol

[@hisschoolwork3987]

Is this required knowledge for AQA?

[@user-zh6si9pt7b]

da goatttttt dalhinio

[@Naraluxury]

I wish I could get the same teacher to help me in business and Accounting please anyone with an idea I will be thankful thank you lots

[@karthigeyanramesh3355]

Hi sir I don't understand why the firm is making a supernormal profit? isn't the firms supposed to make a loss.

[@asherlearmonth9787]

bruv... i love you

[@ntwali.m6592]

mid 2018???

[@hareemabdulrauf1746]

Thanks alot. I m just confused in onething. If avc=ar then firm is covering its avc so why is it necessary for it to shutdown in that case? Please help

[@niranjanamaheswari]

U r getting wrong...they won't shut down

[@hokfeigao9073]

why does a loss-making firm in perfect competition shut down in the long run.

[@SuperY4S1N]

he literally explains it here, if it cant survive in the SR it wont survive in the LR

[@aaronpurcell-cox51]

This makes sense but I thought firms couldn't leave a market in the short run because the definition of the short run is when there is at least one fixed factor of production and to leave a market means you have to change your factors of production right?

[@EconplusDal]

Don't get confused Aaron between definitions of Short Run (Costs) and Short Run (Market Structures). For market structures, time period is defined by the level of profit made

[@aaronpurcell-cox51]

Ah ok. Thanks.

[@sjm7666]

is shutdown competition aqa? As it is not on the specification

[@sanjana_x_o]

Hi, I’ve seen some questions on the shut down condition in the new spec multichoice so would revise it just in case xx

[@qwerttttttttttty]

This isnt only for perfect competition right?

[@sharepremium8614]

No

[@aynociz]

so can firms survive in the short run when AR=AVC aswell as when AR>AVC or is it only when AR>AVC

[@chloemoretz8621]

Firms in the short-run can survive with a loss being at AR>AVC, however at AR=AVC the firms will shutdown. Hopefully that helped

[@user-gx6zw3ws4x]

@@chloemoretz8621 if ar >avc how is the firm suffering a loss? Isn't that eos?

[@JeyDraper]

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