Suppose That All Firms in a Given Industry Have the Same

question 38

Multiple Choice

Suppose that all firms in a given industry have the same supply curve given by S_i(p) = 2p when p is greater than or equal to $2 and S_i(p) = 0 when p is less than $2.Suppose that market demand is given by D(p) = 12 - p.If firms continue to enter the industry so long as they can do so profitably, the equilibrium price must be closest to

• A)$5.
• B)$4.
• C)$2.40.
• D)$2.
• E)$1.75.

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An ancient Greek philosopher and polymath, whose writings covered a wide range of subjects and significantly influenced Western philosophy and science.

Premises Imply

The logical process where a set of stated propositions (premises) are shown to necessarily lead to a specific conclusion.

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A deduction or inference that does not logically follow from the premises or evidence provided.