Assume That the Market for Soybeans Is Purely Competitive

question 140

Multiple Choice

Assume that the market for soybeans is purely competitive. Currently, firms growing soybeans are earning positive economic profits. In the long run, we can expect

• A) new firms to enter, causing the market price of soybeans to fall.
• B) new firms to enter, causing the market price of soybeans to rise.
• C) some firms to exit, causing the market price of soybeans to fall.
• D) some firms to exit, causing the market price of soybeans to rise.

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Definitions:

Scale

A measurement tool or system that quantifies or categorizes variables, often used in surveys and research.

Factor Analysis

A statistical technique that uncovers latent variables or factors responsible for the correlation patterns among a collection of observed variables.

Variables

Characteristics or conditions that can change and potentially affect the outcome of a study or experiment.

Interrelationships

The way in which two or more concepts, objects, or people are connected and affect each other.