In the Long Run, If New Fringe Firms with Same

question 5

Multiple Choice

In the long run, if new fringe firms with same cost structures as existing fringe firms enter the oligopoly market:

• A)the dominant firm's ability to extract profit from the market decreases.
• B)the fringe's ability to extract profit from the market decreases.
• C)the fringe supply curve rotates leftward and downward.
• D)the dominant firm's residual demand curve rotates rightward.

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Definitions:

Persuasion

The process of influencing someone's beliefs, attitudes, intentions, motivations, or behaviors through communication and various techniques.

Motivated

Having a strong desire or willingness to act and achieve specific goals.

Commercial

Relating to or engaged in commerce; intended for or pertaining to the selling and buying of goods and services.

Source Credibility

The perceived trustworthiness, expertise, and reliability of the source of information.