If a Typical Firm in a Perfectly Competitive Industry Is

question 135

Multiple Choice

If a typical firm in a perfectly competitive industry is incurring losses, then

• A)all firms will continue to lose money.
• B)some firms will exit in the long run, causing market supply to decrease and market price to rise, increasing profits for the remaining firms.
• C)some firms will exit in the long run, causing market supply to decrease and market price to fall, increasing losses for the remaining firms.
• D)some firms will enter in the long run, causing market supply to increase and market price to rise, increasing profit for all firms.

---

Definitions:

Type A Misfires

Refers to engine misfires that are consistent and can often be traced back to a specific cylinder or cause, such as fuel, ignition, or mechanical issues.

Type B Misfires

Misfires in an engine that happen under specific conditions or times, potentially indicating a sporadic or intermittent problem.

Emissions-Threatening

Pertaining to substances or activities that pose a risk to air quality by releasing harmful pollutants.

Catalyst-Damaging

Pertaining to substances or conditions that can degrade or impair the function of a catalytic converter, which is an emissions control device in vehicles.