If a Perfectly Competitive Market Is in a Short- Run

question 71

Multiple Choice

If a perfectly competitive market is in a short- run equilibrium and each firm has P > SRATC, then

• A) individual firms in the industry will increase their output.
• B) price will fall in the short run as it is too high and firms are making economic profits.
• C) the market supply curve will become less elastic.
• D) existing firms will continue to earn economic profits in the long run.
• E) new firms will enter the market because existing firms are earning economic profits.

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Definitions:

Action Potential

A rapid rise and subsequent fall in voltage or electrical charge across a cellular membrane, typically neurons, signaling along the nerve.

Resting Membrane Potential

This refers to the voltage difference across the membrane of a resting (non-conducting) neuron, maintaining a balance of ionic gradients.

Plasma Membrane

The lipid double-layer that enwraps the cell's cytoplasm, directing the flow of substances into and away from the cell.

Sodium-Potassium Pump

A membrane-bound enzyme complex that exchanges sodium ions for potassium ions across the plasma membrane of cells, crucial for cellular function.