When Entry and Exit Behavior of Firms in an Industry

question 179

Multiple Choice

When entry and exit behavior of firms in an industry does not affect a firm's cost structure,

• A) the long-run market supply curve must be horizontal.
• B) the long-run market supply curve must be upward-sloping.
• C) the long-run market supply curve must be downward-sloping.
• D) we can't tell anything about the shape of the long-run market supply curve.

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Definitions:

Fallacy

A deceptive, misleading, or false notion, belief, or argument; often, a statement or argument based on a false or invalid inference.

Appeal to Ignorance

A logical fallacy that suggests a claim is true simply because it has not been proven false or vice versa.

Burden of Proof

The obligation to prove one's assertion.

Positive Claim

An assertion that something exists or is true, especially one without proof.