Assume an increase in the profitability of firms in a product market. Over time, we can expect

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Quizplus · Accepted Answer

An increase in the profitability of firms in a product market would likely lead to an increase in the demand for resources as these firms seek to expand production to capitalize on the higher profits. This is because more profitable conditions attract more investment and expansion efforts, requiring more inputs or resources.

Assume an Increase in the Profitability of Firms in a Product