Suppose That Each of 10,000 Perfectly Competitive Firm in an Industry

question 186

Essay

Suppose that each of 10,000 perfectly competitive firm in an industry produces 1,000 units of a good and earns an economic profit when the price of the good is $10.In the long run,definitely
A) each firm increases its production above 1,000 units.
B) the number of firms is more than 10,000.
C) consumer surplus decreases.
D) producer surplus increases.
E) the number of firms is less than 10,000.

• A) each firm increases its production above 1,000 units.
• B) the number of firms is more than 10,000.
• C) consumer surplus decreases.
• D) producer surplus increases.
• E) the number of firms is less than 10,000.

---

Definitions:

Milton Friedman

An American economist and Nobel laureate known for his extensive work on consumption analysis, monetary history and theory, and the complexity of stabilization policy.

Profit Maximization

A business strategy aimed at generating the greatest possible profit, focusing on revenue enhancement and cost minimization.

Shareholders

Individuals or entities that own one or more shares of a company's stock, making them partial owners of the company.

CSR Initiative

A company's act of engaging in socially responsible activities, practices, and policies, aiming to have a positive impact on society, the environment, and stakeholders.