-The Above Figure Shows Three Possible Average Total Cost Curves

question 255

Multiple Choice

-The above figure shows three possible average total cost curves.If all firms in a perfectly competitive industry each have an average total cost curve identical to ATC?,each produce 30 units,and the market price of the good is $16 per unit,then the firms

• A) make zero economic profit and firms neither enter nor exit the industry.
• B) make zero economic profit and so some firms exit the industry.
• C) incur an economic loss and so some firms exit the industry.
• D) incur an economic loss and so new firms enter the industry.
• E) make an economic profit and new firms enter the industry.

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Definitions:

America First Committee

A non-interventionist group formed in the United States prior to World War II that advocated for keeping the US out of the conflict.

Henry Ford

An American industrialist and the founder of Ford Motor Company, he revolutionized factory production with his assembly line methods.

Charles Lindbergh

An American aviator who gained fame for making the first solo transatlantic airplane flight in 1927.

Gerald P. Nye

A U.S. senator from North Dakota who is best known for his investigations into the munitions industry, leading to the Nye Committee hearings in the 1930s which were critical of America's involvement in World War I.