If All Firms in an Industry Which Is Characterized by Decreasing

question 76

Multiple Choice

If all firms in an industry which is characterized by decreasing costs are charging a price equal to marginal cost, then an upward shift in demand in the long run will:

• A)increase industry output and lower price.
• B)decrease industry output and raise price.
• C)alter neither industry output nor price.
• D)result in much more competitive industry structure.
• E)do none of the above.

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Definitions:

Ownership Interest

A stake or share in an asset or entity, giving the holder a claim to a portion of its value or profits.

Cash Received

Income or revenue received in the form of cash, including physical currency, checks, and digital transfers.

Corporate AMT

The Alternative Minimum Tax for corporations, designed to ensure that profitable companies pay at least a minimum amount of tax.

Average Annual Gross Receipts

The average amount of money received by a business before any deductions over a specified period, typically 3 to 5 years.