When Market Conditions in a Competitive Industry Are Such That

question 110

Multiple Choice

When market conditions in a competitive industry are such that firms cannot cover their production costs,then

• A)the firms will suffer long-run economic losses.
• B)the firms will suffer short-run economic losses that will be exactly offset by long-run economic profits.
• C)some firms will exit the market, causing prices to rise until the remaining firms can cover their production costs.
• D)all firms will go out of business, since consumers will not pay prices that enable firms to cover their production costs.

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Definitions:

Emergency Room

A medical treatment facility specializing in emergency medicine, the acute care of patients who present without prior appointment.

Working Backward

A problem-solving strategy that involves starting from the desired solution or goal and working in reverse to determine the steps needed to reach that goal.

Well-Specified Goal

A clear and detailed objective that is explicitly defined, making it understandable and achievable.

Many Options

The state of having numerous choices available in a given situation, allowing for flexibility in decision-making.