Suppose a Competitive Market Is Comprised of Firms That Face

question 232

Multiple Choice

Suppose a competitive market is comprised of firms that face identical cost curves. The firms experience an increase in demand that results in positive profits for the firms. Which of the following events are then most likely to occur? (i)
New firms will enter the market.
(ii)
In the short run, price will rise; in the long run, price will rise further.
(iii)
In the long run, all firms will be producing at their efficient scale.

• A)(i) and (ii) only
• B)(i) and (iii) only
• C)(ii) and (iii) only
• D)(i), (ii) and (iii)

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Definitions:

Sinoatrial Node

The heart's natural pacemaker, located in the right atrium, responsible for initiating the heartbeat.

Wave of Depolarization

A rapid change in electrical charge across a cell membrane, leading to nerve impulse transmission or muscle contraction.

QRS Complex

A portion of an electrocardiogram (EKG) representing the depolarization of the heart's ventricles, preceding the ventricular contraction.

Ventricles

Ventricles are the two lower chambers of the heart that receive blood from the atria and pump it out to the lungs and the rest of the body.