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Suppose All Firms in a Perfectly Competitive Industry Are Earning

question 28

Multiple Choice

Suppose all firms in a perfectly competitive industry are earning an economic profit. One would expect that, over time, the number of firms in the industry will ________ and the market price will ________.


Definitions:

Liability Accounts

Accounts on a company's balance sheet that track what the company owes to others, such as loans payable, accounts payable, and mortgage payable.

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