We would expect an industry to expand if firms in that industry are
A) earning normal profits.
B) earning economic profits.
C) breaking even.
D) earning accounting profits.

Question

Quizplus · Accepted Answer

If firms in the industry are earning economic profits, it suggests that there is excess demand for the goods or services offered by the industry. This will incentivize new firms to enter the industry, which will cause the industry to expand.

We Would Expect an Industry to Expand If Firms in That