In Reality,the Long-Run Supply Curve for a Perfectly Competitive Market

question 37

Multiple Choice

In reality,the long-run supply curve for a perfectly competitive market is upward sloping because:

• A) of changing costs of production that firms may face.
• B) not all firms have identical cost structures.
• C) experienced firms will have different information and costs than new firms.
• D) All of these are true.

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Definitions:

Effort Level

The degree of intensity, diligence, and concentration applied by an individual or group to accomplish tasks.

Wage Rate

The amount of compensation workers receive for their labor per unit of time, which can be hourly, daily, or annually basis.

Efficiency Wage

Wage that a firm will pay to an employee as an incentive not to shirk.

Shirking

The behavior of employees reducing their effort or productivity, especially when their work effort is unmonitored or difficult to measure.