Assume a Perfectly Competitive Industry Is in Long-Run Equilibrium at a Price

question 34

Multiple Choice

Assume a perfectly competitive industry is in long-run equilibrium at a price of $20. If this industry is a constant-cost industry and the demand for the product decreases, long-run equilibrium will be reestablished at a price

• A) greater than $20.
• B) less than $20.
• C) of $20.
• D) either greater than or less than $20 depending on the magnitude of the decrease in demand.

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Definitions:

Teenage Births

Refers to the incidence of childbirth among females aged 13 to 19.

Unemployment Rate

The percentage of the labor force that is jobless and actively seeking employment.

Liberal Theory

Liberal theory advocates for individual rights, free trade, and minimal government intervention in the economy, emphasizing individual freedom and equality.

Conservative Theory

A political and social philosophy that promotes retaining traditional social institutions in the context of culture and civilization.