Suppose there is a large and permanent increase in the demand for a good produced in a competitive industry. We should expect that:
A) existing firms will face lower sunk costs.
B) competition in the industry will decrease.
C) existing firms' average cost curves will shift upwards.
D) firms will enter the industry because the market price will rise.
Correct Answer:
Verified
Q92: Q125: What condition is necessary in a constant Q135: In a constant cost industry, the market Q152: Which of the following is NOT an Q154: In an increasing cost industry: Q159: In an increasing cost industry,: Q161: To maximize profit, a firm in a Q167: Marginal cost is the change in total Q172: Firms in competitive industries should adhere to: Q197: The marginal cost curve may intersect the
A) above-normal profits
A) costs rise
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