When a perfectly competitive industry is in long-run equilibrium, firms maximize profits, and entry forces the price down
a. until all loss making firms leave the industry.
b. until each firm can earn acceptable level of economic profit.
c. until price becomes tangent to the long run average cost curve.
d. until the long average cost curve rises above the demand curve.
c
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In the figure above, if the government provides the efficient amount of education, how many students will be accepted?
A) 8 million per year B) 12 million per year C) 10 million per year D) 16 million per year
A ____ total cost function yields a U-shaped average total cost function
a. cubic b. quadratic c. linear d. a and b only e. a, b, and c
Which of the following statements best explains the effects of transfer payments and taxes on aggregate spending? a. Transfer payments and taxes affect aggregate spending directly, just as consumption does
b. Transfer payments and taxes affect aggregate spending indirectly by first changing disposable income and thereby changing consumption. c. Changes in the amount of transfer payments and taxes cancel each other and therefore have no influence on any economic variable. d. Transfer payments and taxes affect disposable income but have no effect on consumption. e. Transfer payments affect disposable income, but taxes do not.
An increase in the government budget deficit causes national saving to _____, the interest rate to _____, and investment to _____
Fill in the blank(s) with correct word