If perfectly competitive firms are earning positive economic profits in the short run, then in the long run other firms will enter the market.

The United States has a closed economy

Indicate whether the statement is true or false

If the demand for the Ford Mustang increases, we would expect Ford to

A) keep the price of Mustangs constant, regardless of the cost or benefit of a price change. B) increase the price of Mustangs to keep pace with the increase in demand. C) increase the price of Mustangs only if the benefit of a price increase outweighs the cost. D) decrease the price of Mustangs to maintain the increase in demand.