As long as existing firms ________ in an industry, some existing firms will exit the industry, causing the industry ________ curve to shift to the left.
A) incur economic losses; supply
B) break even; demand
C) incur economic losses; demand
D) break even; supply

Question

Quizplus · Accepted Answer

When firms in an industry incur economic losses, it means they are not covering their total costs, leading some to exit the industry. This exit reduces the total quantity of goods or services supplied in the market, hence shifting the supply curve to the left.

As Long as Existing Firms ________ in an Industry, Some