Refer to Figure 13-13. If the diagram represents a typical firm in the market, what is likely to happen in the long run?
A) Inefficient firms will exit the market and new cost-efficient firms will enter the market.
B) New firms will enter the market causing the demand to decrease for existing firms.
C) Competition will be intensified as firms strive to make long-run profits.
D) Some firms will exit the market causing the demand to increase for firms remaining in the market.
B
You might also like to view...
An employer discriminating against Asian workers is an example of:
A) special interest group discrimination. B) cultural discrimination. C) statistical discrimination. D) taste-based discrimination.
Donna owns the only dog grooming salon on Lonely Island. The figure above shows the dog grooming market. Donna is a single-price monopoly that maximizes profit by charging ________ per grooming and producing ________ groomings per day
A) $30; 8 B) $20; $8 C) $20; $12 D) None of the above answers is correct.
How do external costs prevent a competitive market from allocating resources efficiently?
What will be an ideal response?
A disadvantage of chain-weighting is that
A) past inflation rates change whenever the base year changes. B) past growth rates of real GDP change whenever the base year changes. C) it causes output growth to slow. D) the components of real GDP don't sum to real GDP.