If the graph below depicts the operations of the average firm in a perfectly competitive industry, which of the following is most likely to occur? P ATC MC D new firms will enter the market increasing price and profits new firms will enter the market decreasing price and profits existing firms will exit the market increasing price and profits existing firms will exit the market decreasing price and profits none of the above

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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If the graph below depicts the operations of the average firm in a perfectly
competitive industry, which of the following is most likely to occur?
P
ATC
MC
D
new firms will enter the market increasing price and profits
new firms will enter the market decreasing price and profits
existing firms will exit the market increasing price and profits
existing firms will exit the market decreasing price and profits
none of the above
Transcribed Image Text:If the graph below depicts the operations of the average firm in a perfectly competitive industry, which of the following is most likely to occur? P ATC MC D new firms will enter the market increasing price and profits new firms will enter the market decreasing price and profits existing firms will exit the market increasing price and profits existing firms will exit the market decreasing price and profits none of the above
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