If There Is a Permanent Decrease in Demand in a Perfectly

question 39

Multiple Choice

If there is a permanent decrease in demand in a perfectly competitive market, then there is an initial ________ in price and existing firms ________.

• A) rise; make an economic profit
• B) rise; incur an economic loss
• C) fall; make an economic profit
• D) fall; incur an economic loss

---

Definitions:

Agent

An individual or entity authorized to act on behalf of another (the principal) in dealings with third parties.

Contract Remedies

Legal solutions provided in case of a breach of contract, including compensation, specific performance, and rescission, designed to address or correct the breach.

Tort Remedies

Legal solutions available in tort law for injuries or damages, including restitution, damages compensation, and injunctive relief.

Agent Duties

Obligations that an agent owes to their principal, including acting in the principal's best interest, with care, loyalty, and confidentiality.