Refer to the above figure. As more and more firms are able to and actually do enter the industry, the demand curve of each firm and its marginal revenue curve
A) will shift inward until the demand curve is tangent to the average total cost curve.
B) will become vertical.
C) will become upward sloping.
D) None of the above will occur.
A
You might also like to view...
Minneapolis business Rogue Chocolatier sells specialty chocolate bars with a high cocoa content. Rogue can produce 15 chocolate bars per day with one employee, 35 with 2, 50 with 3 and 55 with 4 employees. Which statement is TRUE?
A) Rogue's marginal product curve initially increases and then decreases. B) Rogue's marginal product curve decreases continually. C) Rogue's total product curve increases at an increasing rate. D) Rogue's marginal product curve decreases initially and then increases.
The existence of a deadweight loss associated with a monopoly can be seen because
A) consumers are willing to pay more for the last unit of output than it costs to produce. B) the cost of the last unit produced is more than consumers are willing to pay for it. C) the producer surplus is larger than in a competitive market. D) None of the above.