In the Long Run, Firms Will Enter Industries Where Price

question 137

Multiple Choice

In the long run, firms will enter industries where price is:

• A) greater than average cost.
• B) equal to average cost.
• C) less than average cost.
• D) positive.

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Definitions:

Raw Materials Production

The process involved in generating or extracting the basic materials that are subsequently processed to become components or products.

Production Budget

An estimate of the cost to manufacture a set of products in a specified period.

Raw Materials Inventory

The value of all the materials that are yet to be used in manufacturing.

Required Production

The quantity of products that a company must manufacture in a specific period to meet customer demand and inventory policies.