Under perfect competition, if an industry is characterized by positive economic profits in the short run:
a. firms will leave the market in the long run and the short-run supply curve will shift outward.
b. firms will enter the market in the long run and the short-run supply curve will shift outward.
c. firms will enter the market in the long run and the short-run supply curve will shift inward.
d. firms will leave the market in the long run and the short-run supply curve will shift inward.
b
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The utility a consumer derives from knowing that others receive benefit from an environmental good is called
a. stewardship value c. direct user value b. indirect user value d. vicarious consumption
Perfect competition does not assume that
a. buyers are well informed about products and prices. b. free entry into and exit from the market exists. c. no individual buyer or seller can influence a price. d. all firms operate at the same cost.
Suppose you found $10,000 hidden under a rock and deposited it in a demand deposit account at your bank. If the reserve requirement was 10 percent, your deposit would initially add ____ to total demand deposits and over time increase the money supply by a maximum of ____
a. $10,000; $100,000 b. $10,000; $90,000 c. $1,000; $90,000 d. $1,000; $9,000
What do government purchases include in national income accounting?
A. Government transfer payments B. Purchases of goods for consumption but not public capital goods C. Purchases by federal, state, and local governments D. Purchases by the federal government only