Which of the Following Events Does NOT Occur When Market

question 31

Multiple Choice

Which of the following events does NOT occur when market demand shifts leftward in an increasing-cost industry?

• A) Initially, the output produced by existing firms declines along the short-run market supply curve.
• B) The market price declines below the minimum LAC due to the short-run supply response.
• C) The market supply curve shifts leftward as some firms exit the market when the market price is below the minimum LAC.
• D) As firms exit, the market price rises and attracts other firms to enter the market.
• E) The LAC curve shifts downward as output falls.

---

Definitions:

World Trade Organization

An international organization designed to supervise and liberalize world trade, acting as a forum for negotiating trade agreements and a place for resolving trade disputes.

Domestic Employment

Jobs or positions of employment within a country's own borders, as opposed to international or overseas employment.

Imported Good

A product or commodity brought into one country from another for sale.

Diversification-for-Stability

A strategy aiming to reduce risk by allocating investments among various financial instruments, industries, or other categories.