If a Perfectly Competitive Market Is in a Short-Run Equilibrium

question 138

Multiple Choice

If a perfectly competitive market is in a short-run equilibrium and each firm has P > SRATC,then

• A)individual firms in the industry will increase their output.
• B)new firms will enter the market because existing firms are earning economic profits.
• C)the market supply curve will become less elastic.
• D)existing firms will continue to earn economic profits in the long run.
• E)price will fall in the short run as it is too high and firms are making economic profits.

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Definitions:

Relevant Data

Information that is directly related and useful to the decision-making process in research or business analysis.

Supply Chain

The sequence of processes involved in the production and distribution of a commodity.

Production Processes

The methods and sequences of operations used to design, manufacture, and deliver products or services.

SCM Components

Elements that make up Supply Chain Management, including planning, sourcing, production, delivery, and logistics.