If firms in a competitive price-searcher market are incurring economic losses, which of the following scenarios would best describe the change existing firms (who are able to stay in the market) would face as the market adjusts to long-run equilibrium?

Question

Quizplus · Accepted Answer

As firms exit the market due to economic losses, the remaining firms will face less competition, leading to an increase in demand for their products and allowing them to charge higher prices until normal profits are restored in the long-run equilibrium.

If Firms in a Competitive Price-Searcher Market Are Incurring Economic