If Economic Profits in a Particular Industry Increase, Then We

question 85

Multiple Choice

If economic profits in a particular industry increase, then we would expect:

• A) Resources to be diverted away from that industry
• B) Firms in that industry to produce less output
• C) Firms to enter that industry thus expanding it
• D) Consumers to buy less from that industry

Understand the impact of the number of firms in an industry on market models and competition levels.

Identify market models based on the level of price control within the industry.

Understand the concept of imperfect competition and its applicability across market models.

Recognize the relationship between product standardization and market competition.

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Definitions:

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The process by which a parent cell divides into two or more daughter cells, essential for growth, repair, and reproduction of living organisms.