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New Reports Indicate That Eating Turnips Helps People Remain Healthy

Question 37

Multiple Choice

New reports indicate that eating turnips helps people remain healthy. The news shifts the demand curve for turnips rightward. In response, new farms enter the turnip industry. During the period in which the new farms are entering, the price of a turnip _______ and the economic profit of each existing firm _______ .


A) rises; falls
B) falls; rises
C) falls; falls
D) rises; rises

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