Willie's Wading Adventures Sells Hip Waders for Fishing and Duck

question 432

Multiple Choice

Willie's Wading Adventures sells hip waders for fishing and duck hunting in a perfectly competitive market. If hip waders sell for $100 each and average total cost per unit is $95 at the profit-maximizing output level, then in the long run

• A)more firms will enter the market.
• B)some firms will exit from the market.
• C)the equilibrium price per unit will rise.
• D)average total costs will fall.