The decision to enter or exit an industry is based:
A) only on the level of profits/losses today.
B) only on the level of profits/losses in the future.
C) on lifetime expected profits.
D) on the marginal cost of production.

Question

Quizplus · Accepted Answer

The decision to enter or exit an industry should take into account the lifetime expected profits, rather than just the current level of profits or losses. It is important to consider future market conditions, competition, and potential changes in technology or regulations that could affect the profitability of the industry. By calculating the expected lifetime profits, a company can make a more informed decision about whether to enter or exit a particular market.

The Decision to Enter or Exit an Industry Is Based