It is possible that a firm in a perfectly competitive market earns a negative profit in the long run.

An upturn in business confidence may cause firms to ________ their estimates of MPK, leading to a ________ capital stock that matches MPK to the user cost of capital and thus ________ of net investment

A) lower, larger, a contraction B) lower, larger, an expansion C) lower, smaller, a contraction D) raise, smaller, a contraction E) raise, larger, an expansion

Employers verify the facts of potential employees' resumes to avoid

A) signaling. B) screening. C) cheap talk. D) moral hazard.