In a Competitive Industry, Entry and Exit Decisions

question 78

Multiple Choice

In a competitive industry, entry and exit decisions:

• A) allow some firms to earn above-normal profits in the long run.
• B) ensure that labor and capital move across industries to optimally balance production.
• C) rely on demand signals, not price signals.
• D) move capital and labor away from profitable industries in order to maximize the total value of production.

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Definitions:

Stress Response

The body's reaction to a challenge or demand, characterized by physical, emotional, or psychological changes.

Well-being

A state of comfort, health, or happiness that can be evaluated through physical, psychological, and socio-economic dimensions.

Motivation

The psychological forces that determine the direction of a person's behavior, the level of effort, and the level of persistence.

Performance

The act of carrying out a task or function, often evaluated in terms of effectiveness, quality, or efficiency.