A perfectly competitive market is in long-run equilibrium. Then demand decreases. The decrease in demand leads to
A) a rise in the price in the short run.
B) the firms' incurring an economic loss in the short run.
C) firms entering the market in the long run.
D) none of the above
B
You might also like to view...
Normally in the United States the relationship between nominal and real GDP for a given year is
A) real GDP is greater than nominal GDP because of price increases. B) nominal GDP is greater than real GDP because of price increases. C) nominal GDP equals real GDP. D) nominal GDP is greater than real GDP because of price decreases.
The credit spread is countercyclical and coincident, suggesting that a sudden increase in financial frictions is most likely ________
A) when the economy has been expanding for some time B) after the economy has turned into a recession C) during the recovery phase of the business cycle D) when expected inflation is declining