When Firms Have an Incentive to Exit a Competitive Market

question 8

Multiple Choice

When firms have an incentive to exit a competitive market, their exit will

• A)lower the market price.
• B)necessarily raise the costs for the firms that remain in the market.
• C)raise the profits of the firms that remain in the market.
• D)shift the demand for the product to the left.

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Definitions:

Psychosocial Development

A theory that describes the stages of psychological and social development that humans go through from infancy to adulthood.

Self-confidence

The belief in one's own abilities or competence.

Basic Characteristic

A fundamental or inherent attribute that defines or distinguishes an entity, concept, or thing.

Psychosocial Development

A theory that divides human growth and development into eight stages, each involving psychological and social conflicts that individuals must resolve to develop essential virtues.