Which of the Following Statements About Pure Competition in the Long

question 187

Multiple Choice

Which of the following statements about pure competition in the long run is not true?

• A)Entry and exit of firms will push economic profits of firms in the industry toward zero.
• B)Entry and exit of firms will shift the demand curve facing the representative firm in the industry.
• C)The long-run adjustment in pure competition happens through shifts in the industry supply curve.
• D)The long-run adjustment in pure competition happens through shifts in the industry demand curve.

---

Definitions:

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in the price of that good.

Fresh Fish

Fish that have been recently caught and have not been frozen or processed.

Total Revenue

Total Revenue is the full amount of money received by a company for its goods or services, before any expenses are subtracted.

Equilibrium Price

The price at which the quantity of goods supplied is equal to the quantity of goods demanded in a market.