When existing firms leave a perfectly competitive industry, ________
A) the equilibrium price decreases, while the equilibrium quantity increases
B) the equilibrium price increases, while the equilibrium quantity decreases
C) both the equilibrium price and quantity increase
D) both the equilibrium price and quantity decrease
B
You might also like to view...
Since 1925, the longest recession in the United States lasted:
A. 120 months. B. 43 months. C. 60 months. D. 21 months.
The table above lists the market shares of the twenty makers of personal computers. The four-firm concentration ratio tells us that
A) the four largest firms have 20 percent of the market. B) there are no barriers to entry in this market. C) the firms sell differentiated products. D) all firms sell identical products.
Suppose the velocity of money is not fixed, but stable at about 4% growth per year
How could the quantity theory of money be modified to include a stable growth rate of the velocity of money? In this modified version with velocity growing at about 4% per year, what would the growth rate of the other variables need to be to cause inflation?
Refer to the payoff matrix below. Which of the following is true for Best Lights?
A) They do not have a dominant strategy.
B) Their pure strategy is to set a Low Price.
C) They do not have a pure strategy.
D) Their pure strategy is to set a High Price.