If the technology associated with producing fiber-optic cable continues to advance,over time the cost of producing fiber-optic cable will
A) decrease, firms that use the new technology will make an economic profit, and in the long run new firms will enter the market.
B) decrease, firms that use the new technology will incur an economic loss, and in the long run some firms will exit the industry.
C) increase, firms that use the new technology will make an economic profit, and in the long run new firms will enter the market.
D) increase, firms that use the new technology will incur an economic loss, and in the long run some firms will exit the industry.
E) decrease, firms that do not use the new technology will make an economic profit, and in the long run new firms will enter the market.

Question

Quizplus · Accepted Answer

As the technology associated with producing fiber-optic cable advances, firms will be able to produce cable at a lower cost. This will allow firms that use the new technology to make an economic profit. Additionally, the lower cost of production will attract new firms to enter the market in the long run.

If the Technology Associated with Producing Fiber-Optic Cable Continues to Advance,over