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:

Trade Deficits

A situation in which a country's imports of goods and services exceed its exports, leading to more money flowing out of the country than coming in.

World's Largest Exporter

The country or entity that sells the largest amount of goods to foreign countries, measured by value.

Exports

Merchandise or services originating from one country and sold to purchasers in another country.

World Bank

A global financial organization that offers loans and grants to the governments of less wealthy nations to support their capital projects.