Technology Reduces the Average Cost of Production, So in the Long

question 217

Multiple Choice

Technology reduces the average cost of production, so in the long run i. perfectly competitive firms produce at a lower average cost.
Ii. the market price of the good falls.
Iii. firms with older plants either exit the market or adopt the new technology.

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

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Definitions:

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