We Can Predict That Resources Will Move into an Industry

question 113

Multiple Choice

We can predict that resources will move into an industry whenever

• A)accounting profits for firms in that industry are greater than zero.
• B)accounting profits for firms in that industry are zero.
• C)economic profits for firms in that industry are zero.
• D)economic profits for firms in that industry are greater than zero.
• E)economic losses for firms in that industry are minimized.

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Definitions:

Law Of Diminishing Marginal Returns

An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other variables remain at a constant.

Total Output

The overall quantity of goods and services produced in an economy within a specific time frame.

Units Of Input

Quantitative measures of the resources used in the production of goods or services.