In a market system, resources will move away from an industry when
A) proﬁts of ﬁrms in the industry are rising.
B) demand for the industry's product is decreasing.
C) the production of output in the industry is rising.
D) proﬁts of ﬁrms in other industries are falling.

Question

Quizplus · Accepted Answer

Resources will move away from an industry when there is a decrease in demand for the industry's product. This will result in lower revenues and profits for firms in the industry, making it less attractive for resources to be allocated to it.

In a Market System, Resources Will Move Away from an Industry