Multiple Choice
A perfectly competitive market is initially in long-run competitive equilibrium. Then, market demand falls. This causes the marginal revenue curves for existing firms to shift __________ and for these firms to produce __________ output. Some of the existing firms will end up __________.
A) upward, more, increasing their plant size
B) downward, less, exiting the market
C) downward, more, purchasing more capital equipment
D) upward, less, cutting fixed costs
E) none of the above
Correct Answer:
Verified
Correct Answer:
Verified
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