When Firms Earn Above Normal Rates of Return

question 361

Multiple Choice

When firms earn above normal rates of return

• A) they are able to raise their prices to increase their profits.
• B) they are earning positive profits and new firms are likely to enter the industry.
• C) they tend to leave the industry and seek profits elsewhere.
• D) they are still breaking even economically.

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Definitions:

Open Territory

Refers to areas or spaces that are not claimed or controlled by any one group or organization, allowing free access and use.

Social Territory

The concept refers to spaces or domains where social groups establish norms, rules, and identities, influencing how they interact and behave within those spaces.

Semipublic Places

Areas or settings that are not wholly public or private, where access is controlled or restricted to certain groups.

Third Places

Public places on neutral ground where people can gather and interact, such as cafes, parks, or community spaces.