Multiple choice question - Micro33) In a competitive market that is characterized by free entry and exit, what will be the result? A. All firms will operate at efficient scale in the short run. B. The price of the product will differ across firms. C. All firms will operate at efficient scale in the long run. D. The number of sellers in the market will steadily decrease over time32) When profit-maximizing firms in a competitive market are earning profits, what must be happening in the market? A. The most inefficient firms will be encouraged to leave the market. B. New firms will enter the market. C. Market supply must exceed market demand at the market equilibrium price. D. Market demand must exceed market supply at the market equilibrium price

The market where there tend to exist many producers that tend to compete in order to provide…

Answered: 33) In a competitive market that is…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Multiple choice question - Micro

33) In a competitive market that is characterized by free entry and exit, what will be the result?

A. All firms will operate at efficient scale in the short run.
B. The price of the product will differ across firms.
C. All firms will operate at efficient scale in the long run.
D. The number of sellers in the market will steadily decrease over time

32) When profit-maximizing firms in a competitive market are earning profits, what must be happening in the market?

A. The most inefficient firms will be encouraged to leave the market.
B. New firms will enter the market.
C. Market supply must exceed market demand at the market equilibrium price.
D. Market demand must exceed market supply at the market equilibrium price

Definition Video Formula Definition Phenomenon in which market supply and demand balance each other. Market equilibrium is the economic state in which the market demand curve intersects the market supply curve, giving us the equilibrium price and equilibrium quantity for which a commodity can be sold and purchased in an economy. When market equilibrium is achieved, it suggests that all resources have been allocated efficiently and that there is just a distribution of income and resources in the economy. Video Formula

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