Use the Following to Answer Question(s)

question 201

Multiple Choice

Use the following to answer question(s) :
Exhibit: Profit Maximizing

-(Exhibit: Profit Maximizing) The exhibit shows cost curves for a firm operating in a perfectly competitive market. If the market price is P₄:

• A) firms will leave the industry and the price will fall in the long run.
• B) there will be economic profits and firms will enter the industry in the long run.
• C) the market supply curve will shift to the left and price will fall in the long run.
• D) the firm will continue producing q₃ and will continue to make economic profits in the long run.

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Definitions:

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