Suppose That a Competitive Market Is Initially in Equilibrium

question 229

Multiple Choice

Suppose that a competitive market is initially in equilibrium. Then demand increases. If some resources used in production are not available in sufficient quantities for entering firms,

• A)the long-run market supply curve will be upward sloping.
• B)the long-run market supply curve will be perfectly elastic.
• C)in the long run firms will suffer economic losses, leading them to exit the industry.
• D)the number of firms will decrease, and the market will become a monopoly.

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Definitions:

Comparator Function

A mechanism or process that compares two values or inputs, often used in electronics, computing, and regulatory processes to maintain a desired state.

Proprioceptors

Sensory receptors located in muscles and tendons that sense the position and movement of the body parts.

Pacinian Corpuscles

Sensory receptors that detect mechanical changes and vibrations, contributing to the sensation of touch and pressure.

Ruffini End Organs

Sensory receptors within the skin that respond to stretch and twisting, contributing to the sense of body position and touch.