Carol Owns a Running Shoe Store That Operates in a Perfectly

question 362

Multiple Choice

Carol owns a running shoe store that operates in a perfectly competitive market.If running shoes sell for $120 per pair and the average total cost per pair of shoes is $125 at the profit-maximizing output level,then in the long run

• A) more firms will enter the market.
• B) some firms will exit from the market.
• C) the equilibrium price per pair of shoes will fall.
• D) average total costs will fall.

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Definitions:

Increases

A process or action that causes something to become larger, more numerous, or more significant.

Decreases

The act or process of becoming smaller or fewer in size, amount, intensity, or degree.

Negatively Reinforced

A process in behavioral psychology where a behavior is strengthened because a negative condition is removed or avoided.

Positively Reinforced

A process in behavioral psychology where a behavior is encouraged by rewarding it, leading to an increase in the likelihood of the behavior occurring again.