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Explain What Happens to Firm Output and Profits in the Long

question 48

Essay

Explain what happens to firm output and profits in the long run when higher energy costs raise the marginal cost of production for firms in a competitive industry.


Definitions:

Small-batch Production

A manufacturing technique focused on producing small quantities of products, allowing for customization and flexibility.

Continuous-process Production

A manufacturing method where raw materials are processed in a continuous flow through various stages to produce finished products.

Mass Production

The manufacturing of large quantities of standardized products, often utilizing assembly line techniques.

Small-batch Production

A production process characterized by the manufacturing of small quantities of goods tailored to specific customer needs or market demands.

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