Harrison owns a flower shop. Generally, when preferences for a good rise, demand for the good rises. Holding all else constant, this will result in a higher market price, which will lead to in the industry. The latter will in turn the industry, leading the price to a) positive economic profits; attract new firms into; fall b) economic losses; attract new firms into; fall c) positive economic profits; cause some firms to leave; rise further d) economic losses; cause some firms to leave; rise further

Harrison owns a flower shop. Generally, when preferences for a good rise, demand for the good rises. Holding all else constant, this will result in a higher market price, which will lead to in the industry. The latter will in turn the industry, leading the price to a) positive economic profits; attract new firms into; fall b) economic losses; attract new firms into; fall c) positive economic profits; cause some firms to leave; rise further d) economic losses; cause some firms to leave; rise further

Microeconomics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506893

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter10: Price-searcher Markets With Low Entry Barriers

Section: Chapter Questions

Problem 16CQ

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