Suppose that the price of corn, a crop produced in a perfectly (or purely) competitive industry, increased 208% last year as demand for corn-based ethanol fuel increased. What do you expect to happen in the long run for the corn industry given this recent success? The price per bushel of corn will continue to increase, yielding higher profits. Thus, more firms will enter the market indefinitely. O Profits will become negative due to overfarming, which will result in the corn farming industry going under. Profits will be equal to zero. None of the above. Suppose the firms people becoming increasingly concerned about how high-fat diets negatively impact health. the market for bacon, also a perfectly (or purely) competitive industry, experienced losses last quarter due to What do you expect to happen in the long run for the bacon industry? Seeing this as an opportunity to monopolize a fledging industry, firms will enter the industry, shifting supply to the right. Profits will remain negative, which will result in the closing down of the industry as a whole.

Suppose that the price of corn, a crop produced in a perfectly (or purely) competitive industry, increased 208% last year as demand for corn-based ethanol fuel increased. What do you expect to happen in the long run for the corn industry given this recent success? The price per bushel of corn will continue to increase, yielding higher profits. Thus, more firms will enter the market indefinitely. O Profits will become negative due to overfarming, which will result in the corn farming industry going under. Profits will be equal to zero. None of the above. Suppose the firms people becoming increasingly concerned about how high-fat diets negatively impact health. the market for bacon, also a perfectly (or purely) competitive industry, experienced losses last quarter due to What do you expect to happen in the long run for the bacon industry? Seeing this as an opportunity to monopolize a fledging industry, firms will enter the industry, shifting supply to the right. Profits will remain negative, which will result in the closing down of the industry as a whole.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Assume a firm's marginal costs are increasing at its current level of output. If a firm's marginal revenue is less than the marginal cost of producing the last unit of output chosen by the firm, then: Profits can be increased if the firm decreases output. The firm is certainly earning an economic profit but not as much as it could be. Profits can be increased if the firm increases output. The firm's economic profit is necessarily less than zero.
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H11.
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