If all firms in a monopolistically competitive market are incurring losses, then eventually:
a. the demand for the products in the market will increase.
b. the supply of the products in the market will increase.
c. the price of the products in general will decline.
d. the cost of production will increase.
e. the firms will exit until the existing ones just break even.
e
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You can think of velocity as:
A. how much output money can buy. B. how quickly prices are rising. C. how often money changes hands. D. the ratio of the money supply to the inflation rate.
Barbara owns a small shop where dresses are made. At the end of a given month, she has 250 dresses. Her expenses for the month are $1,000 for rent, $6,000 for wages, $1,500 for fabric and thread, and $500 for electricity. Her total variable cost for the month is
a. $6000 b. $4,000 c. $32 per dress d. $7,500 e. $8,000