Suppose That Some Firms in a Perfectly Competitive Industry Are

question 92

Multiple Choice

Suppose that some firms in a perfectly competitive industry are incurring negative economic profits. In the long run, the:

• A) industry supply curve will not shift.
• B) industry supply curve will shift to the left.
• C) number of firms in the industry will not change.
• D) number of firms in the industry will increase.

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Definitions:

IMF

The International Monetary Fund (IMF) is an international organization that aims to promote global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.

WTO

The World Trade Organization, an international body that deals with the rules of trade between nations to ensure that trade flows as smoothly, predictably, and freely as possible.

World Bank

The World Bank is an international financial institution that provides loans and grants to the governments of poorer countries for the purpose of pursuing capital projects aimed at reducing poverty and supporting development.

Modern Economy

Characterizes economies that are highly industrialized and usually have a significant reliance on technology and service sectors.