Exhibit 9-2 -Refer to Exhibit 9-2. If the Demand Curve Shifts from Curve

question 112

Multiple Choice

Exhibit 9-2
-Refer to Exhibit 9-2. If the demand curve shifts from D₁ to D₂, then

• A)some firms enter the industry.
• B)some firms exit the industry.
• C)the number of firms does not change.
• D)firms earn a normal profit.
• E)most firms earn a loss.

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Definitions:

Specialization

The process of focusing on a narrow area of expertise or production, enhancing efficiency and skill through the division of labor.

High Consumption-Low Investment

This term refers to an economic situation where a country or entity spends a significant portion of its income on consumption rather than investing in capital goods that could contribute to future growth.

High Investment-Low Consumption

An economic strategy or situation that focuses on higher levels of investment in capital and infrastructure while maintaining lower levels of consumer spending.

Marginal Benefit

The additional satisfaction or utility that an individual gains from consuming one more unit of a good or service.