Figure 13-12 Figure 13-12 Shows Short-Run Cost and Demand Curves for a and Demand

question 180

Multiple Choice

Figure 13-12

Figure 13-12 shows short-run cost and demand curves for a monopolistically competitive firm in the market for designer watches.
-Refer to Figure 13-12.If the diagram represents a typical firm in the designer watch market, what is likely to happen in the long run?

• A)Some firms will exit the market causing the demand to increase for firms remaining in the market.
• B)The firms that are making losses will be purchased by their more successful rivals.
• C)Inefficient firms will exit the market and new cost-efficient firms will enter the market.
• D)Firms will have to raise their prices to cover costs of production.

---

Definitions:

Abbreviation

A condensed version of a word or phrase, created to make writing and speaking more straightforward.

NPO

An instruction meaning "nil per os" or nothing by mouth, used to restrict oral intake of food and liquids, typically before surgery or certain medical tests.

Expiration Date

The date after which a product like food, medicine, or cosmetics is not recommended to be used.

Divisor

The number used to divide into another number.