In the long run, the number of firms in an industry may change. If the number of firms increases, then
A) the supply curve will shift outward to the right.
B) the demand curve will shift outward to the right.
C) the supply curve will shift inward to the left.
D) the demand curve will shift inward to the left.
Answer: A
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The typical American family spends about ____ percent of its budget on goods and the remainder on services.
A. 22 B. 32 C. 66 D. 80
If a monopoly is able to perfectly price discriminate, then consumer surplus is
A) equal to zero. B) maximized. C) unchanged from what it is with a single-price monopoly. D) unchanged from what it is in a perfectly competitive industry. E) not zero but is less than with a single-price monopoly.
Which of the following methods could be used to correct for external costs?
A) Impose a tax or an effluent fee on the offenders. B) Have the offender clean up the pollution it caused. C) Require firms in the industry to install pollution control devices. D) All of the above would be appropriate.
Beach resorts raise their prices during the summer months and yet more people book rooms at those times. Is this a violation of the law of demand?