If economic losses exist in a monopolistically competitive market,
a. new products will be introduced.
b. new firms will enter the market because they see potential for profit in the future.
c. firms will exit the market and the existing firms' demand curves will shift to the left.
d. the average total cost curve must lie below the demand curve.
e. firms will exit the market and existing firms' demand curves will shift to the right.
e
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The government has a budget surplus if
A) there is no national debt. B) tax revenue is greater than outlays. C) government outlays are greater than tax revenue. D) the budget is balanced. E) a fiscal stimulus is being used to combat a recession.
Under a fractional reserve banking system, banks are required to
(a) keep part of their demand deposits as reserves (b) expand the money supply when requested by the central bank (c) insure their deposits against losses and bank runs (d) pay a fraction of their interest income in taxes (e) charge the same interest rate on all their loans