If a Competitive Industry Is Characterized by Increasing Cost,which of the Following

question 17

Multiple Choice

If a competitive industry is characterized by increasing cost,which of the following will occur in response to an unexpected increase in demand?

• A)New firms will enter the industry.
• B)Economic profit will remain zero.
• C)Input prices will remain constant.
• D)The price of the product will remain unchanged.

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Definitions:

Robin Leidner

A sociologist known for her work on labor processes, service work, and the ways in which jobs are structured and experienced.

Rationalization

The process of offering a logical, reasonable explanation or justification for behaviors or decisions, often as a way of making them appear more acceptable or appropriate.

Efficient

Efficient describes achieving maximum productivity with minimum wasted effort or expense, often relating to the optimal use of resources to obtain a desired outcome.

Bureaucratic Organization

A structured administrative system governing any large institution, characterized by fixed rules, a hierarchy of authority, and a detailed division of labor.