Firms in a perfectly competitive industry are earning economic losses. This is
A) a signal to entrepreneurs that some of the firms in the industry should exit and the resources of these firms should move into production of other goods.
B) a signal to entrepreneurs that additional resources should be brought into this industry in order to make it profitable.
C) a signal that the entrepreneurs are doing a poor job and should become workers for someone else.
D) a signal to government officials that a subsidy is needed for the firms in the industry.
A
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Foreign portfolio investment occurs when an individual or firm buys stock or bonds issued in another country
Indicate whether the statement is true or false
Holding supply constant, an increase in demand leads to
A) lower prices and higher quantity supplied. B) lower prices and lower quantity supplied. C) higher prices and higher quantity supplied. D) higher prices and lower quantity supplied.
Economists emphasize the importance of ____ in analyzing demand
a. quantity b. market potential c. wants and needs d. price e. sales opportunities
Leakages are offset by investment and government spending in the circular flow model
a. True b. False Indicate whether the statement is true or false