As long as economic losses are being earned in an industry, firms will ________ the industry and the supply curve will shift to the ________.
A) enter; right
B) enter; left
C) exit; left
D) exit; right

Question

Quizplus · Accepted Answer

Economic losses indicate that firms are not earning enough revenue to cover their costs, so they will exit the industry in search of better opportunities. As a result, the number of firms in the industry will decrease, shifting the supply curve to the left.

As Long as Economic Losses Are Being Earned in an Industry