Which One of the Following Is Not True of a New

question 34

Multiple Choice

Which one of the following is not true of a new long-run equilibrium which is the result of a new technology in a perfectly competitive market?

• A)The equilibrium price falls.
• B)Industry output increases.
• C)Economic profit of each firm remaining in the industry increases.
• D)All firms in the industry use the new technology.
• E)Average total cost decreases.

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Definitions:

Debt-to-Equity

A measure of a company's financial leverage calculated by dividing its total liabilities by stockholders' equity, indicating the relative proportion of shareholder equity and debt used to finance the company's assets.

Total Asset Turnover

A financial ratio that measures a company's efficiency in using its assets to generate sales or revenue.

Earnings Per Share

A measure of a company's profitability, calculated by dividing its net income by the number of outstanding shares.

Trend Analysis

The practice of collecting information and attempting to spot a pattern, often used in financial markets to predict future movements based on historical data.