In a Competitive Industry, Entry and Exit Decisions

question 78

Multiple Choice

In a competitive industry, entry and exit decisions:

• A) allow some firms to earn above-normal profits in the long run.
• B) ensure that labor and capital move across industries to optimally balance production.
• C) rely on demand signals, not price signals.
• D) move capital and labor away from profitable industries in order to maximize the total value of production.

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Definitions:

Synaptic Cleft

The small gap at a synapse between neurons, through which neurotransmitters are released to transmit nerve impulses.

Neurotransmitter

Chemical substances that transmit signals across a synapse from one neuron to another in the nervous system.

Serotonin Transporter

A protein that facilitates the reuptake of serotonin from the synaptic cleft back into the presynaptic neuron, playing a key role in regulating mood.

Endorphins

Natural painkillers produced by the body, often released in response to stress or exercise, contributing to feelings of well-being and euphoria.