The textile industry is composed of a large number of small firms. In recent years, these firms have suffered economic losses, and many sellers have left the industry. Economic theory suggests that if technology, imports, and other factors remain constant, these conditions will
a. shift the market demand curve outward so that price will rise to the level of production cost.
b. cause the remaining firms to collude so they can produce more efficiently.
c. cause the market supply to decline and the price of textiles to rise.
d. cause firms in the textile industry to suffer long-run economic losses.
C
You might also like to view...
Suppose your bank pays you 5 percent interest per year on your savings account. If prices increase by 5 percent per year over that time, approximately how much real value do you gain by keeping $100 in the bank for a year?
A) $0 B) $1 C) $3 D) $6
Looking at the trade-off between output and a cleaner environment, low-income countries usually would choose what?
a. Less output to feed and house their citizens b. A cleaner environment even if it means the majority of their citizens staying poor c. More output to feed and house their citizens d. A cleaner environment for their citizens
Which of these statements about fiscal policy is correct?
A. Fiscal restraint is implemented when the economy is experiencing high unemployment. B. Fiscal stimulus is implemented when the economy is experiencing high inflation. C. The goal of fiscal policy is to match aggregate demand with full employment potential. D. All of these statements are correc
Suppose you have three choices-go to a movie, read a book, or sleep. You choose to go to a movie. The opportunity cost of the movie is
A. the value of sleeping which you enjoy the least. B. the value of the book not read. C. the value of the concert that you didn't attend. D. the value of the activity that you would have selected if you hadn't gone to the movie.