Refer to the Graphs Shown, Which Depict a Perfectly Competitive

question 14

Multiple Choice

Refer to the graphs shown, which depict a perfectly competitive market and firm. If market demand decreases from D₀ to D₁, the firm will:

• A) raise the price it charges.
• B) earn negative economic profit in the short run.
• C) earn positive economic profit in the short run.
• D) earn positive economic profit in the long run.

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