Suppose that initially the price is $50 in a perfectly competitive market. Firms are making zero economic profits. Then the market demand shrinks permanently, some firms leave the industry, and the industry returns to a long-run equilibrium. What will be the new equilibrium price, assuming cost conditions in the industry remain constant? a. $50.
b. $45.
c. Lower than $50 but exact value cannot be known without more information.
d. Larger than $45 but exact value cannot be known without more information.
+1
Answers (1)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Suppose that initially the price is $50 in a perfectly competitive market. Firms are making zero economic profits. Then the market demand ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Home » Business » Suppose that initially the price is $50 in a perfectly competitive market. Firms are making zero economic profits. Then the market demand shrinks permanently, some firms leave the industry, and the industry returns to a long-run equilibrium.