An increase in license fees -- a long run recurring fixed cost -- will lead to a drop in the number of firms competing in a competitive industry.
Answer the following statement true (T) or false (F)
True
Rationale: An increase in long run recurring fixed costs leads to a leftward (and upward) shift in the lowest point of firm AC curves -- and an upward shift in the long run market supply curve. In the new equilibrium, less will be produced (because of lower quantities demanded at the higher output price) -- but each firm in the industry will produce more (because of the leftward shift in the lowest point of AC curves). Thus, the number of firms must have dropped.
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An income tax _____
a. increases the return to bearing risk, if the company is a monopolist b. has no impact on the return to bearing risk c. increases the return to bearing risk d. reduces the return to bearing risk
As a measure of inflation, the principal advantage of the consumer price index over the implicit GDP deflator is that the consumer price index
What will be an ideal response?
You have a portfolio valued at $10,000. Over the next twelve months it loses 50% of its value. What return does the portfolio need to earn over the following twelve months to be restored to its original value?
A. 100% B. 50% C. 25% D. 200%
Suppose the short-run production function is q = 10 ? L. If the wage rate is $10 per unit of labor, then MC equals
A) q. B) q/10. C) 10/q. D) 1.