If All Firms in a Competitive Industry Experience an Increase

question 65

Multiple Choice

If all firms in a competitive industry experience an increase in marginal costs,then which of the following is most likely to occur in the short run?

• A) Firms will enter the market.
• B) Existing firms will expand production.
• C) Firms will shutdown.
• D) Firms will exit the market.

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Definitions:

Financial Performance

The measure of an organization's profitability, revenue, expenses, and overall financial health.

Transforming Leadership

A leadership approach that creates significant change in the life of people and organizations by elevating the interests of others above the leader’s own.

Moral Values

Principles or standards of behavior that are considered important by a society or individual in distinguishing right from wrong.

Executive Power

is the authority held by individuals in executive positions to make decisions, set policies, and oversee the operations of an organization.