If a Single Firm,belonging to a Perfectly Competitive Industry in Long

question 38

Multiple Choice

If a single firm,belonging to a perfectly competitive industry in long run equilibrium,discovers a significant cost saving methodology,then:

• A)all firms will enjoy economic profits for a short period of time.
• B)the rest of the industry will quickly adopt the new methodology.
• C)the firm will enjoy economic profits forever.
• D)the firm will lower its price to drive the rest of the industry out of business.

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Definitions:

Plasma Membrane

A bi-layer of lipids and proteins surrounding a cell, regulating the passage of substances in and out of the cell.

Proteins

Large molecules composed of amino acids that perform a vast array of functions within living organisms, including structural support, enzyme catalysis, and immune response.

Carbohydrates

Organic compounds, including sugars, starches, and cellulose, which are an important source of energy for the body.

Cell Metabolism

The complex series of chemical reactions occurring within a cell to maintain life, involving the processing of nutrients for energy and the synthesis of necessary substances.