The reason why firms in perfect competition end up with no economic profit in the long run is that
a. they do not have the knowledge to run the firm correctly
b. in the long run, firms lose competitiveness
c. in the long run, costs rise to equal prices
d. if they make an economic profit, new firms will enter the industry, driving the price down, and this continues until economic profit is zero
e. in the long run, the losses of firms who leave the industry equals the economic profit of those who remain
D
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That an increasing number of jobs that do not pay enough to subsist on is ____ theory of poverty.
A. a conservative B. a liberal C. both a liberal and a conservative D. neither a liberal nor a conservative
Figure 6.9 depicts a hypothetical fish market with a horizontal supply curve. Suppose the government imposes a tax of $2 per pound of fish, and the tax is paid in legal terms by producers. Which of the following shows the tax revenue raised by the government?
A. Triangle A B. Rectangle B C. Rectangle B + Triangle C D. Rectangle B + Rectangle D
Market supply is obtained by
A. summing the amount demanded by individual consumers at various prices. B. summing the amount supplied by individual producers at various prices. C. observing how the supply curve shifts. D. the law of supply.
Explain why a tax increase on cigarettes in one state might not lead to a substantial price increase for all consumers in that state
What will be an ideal response?