Multiple Choice
In both price-taker and competitive price-searcher markets, when an increase in market demand disrupts a long-run equilibrium, it will lead to
A) higher short-run prices and long-run profits.
B) higher short-run prices, short-run profits, and the entry of additional firms into the market.
C) higher short-run prices and the exit of firms from the market due to economies of scale.
D) no change in prices in the short run, but new firms will enter in the long run.
Correct Answer:
Verified
Correct Answer:
Verified
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