If a Firm in a Perfectly Competitive Industry Experiences Persistent

question 82

Multiple Choice

If a firm in a perfectly competitive industry experiences persistent losses, in the long run it should

• A)shut down temporarily and wait for market conditions to change.
• B)exit the industry.
• C)raise its price to cover average total cost.
• D)continue to operate if it can raise the demand for its product through advertising and quality improvements.

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Definitions:

Psychodynamic View

A perspective in psychology that emphasizes the influence of the unconscious mind on behavior, stemming from Freudian theory.

Obsessive-Compulsive

Relating to a mental disorder characterized by recurrent, unwanted thoughts (obsessions) and repetitive behaviors (compulsions).

Perfectionism

The tendency to set excessively high standards for oneself and striving for flawlessness, often at the expense of mental well-being.

Personality Disorder

A mental disorder defined by persistent unhealthy behavior, thought patterns, and feelings that are consistent across various situations and differ significantly from what is considered normal in the person's culture.