As new firms enter an increasing-cost industry
A. the position of the LRAC curve doesn't change, but firms move up their LRAC curve.
B. the LRAC curve shifts down.
C. the LRAC curve shifts up.
D. the position of the LRAC curve doesn't change, but firms move down their LRAC curve.
Answer: C
You might also like to view...
Based on the figure above, as a result of international trade, consumer surplus
A) increases by $150 million. B) decreases by $150 million. C) increases by $90 million. D) decreases by $90 million. E) remains unchanged.
Refer to Figure 4-1. If the market price is $1.00, what is the consumer surplus on the third burrito?
A) $0.50 B) $1.00 C) $1.50 D) $7.50
If the demand for land shifts upward, rents will be
A. earned by some land that was formerly unprofitable. B. lost to many landowners. C. diminished for society as a whole. D. taxed away to help pay the costs of government.
Which of the following is not likely to contribute to gains in productivity?
A. Greater expenditures on training and education. B. Improved management. C. Greater expenditures on research and development. D. Increased unemployment benefits.