-Use the data in the table above.Suppose that all the firms in this industry have identical costs to this firm and are producing 15 units of output.One can predict that
A) new firms will enter the industry.
B) old firms will exit the industry.
C) the number of firms in the industry is stable.
D) the price must rise.
E) firms will attempt to lower their implicit costs.

Question

-Use the data in the table above.Suppose that all the firms in this industry have identical costs to this firm and are producing 15 units of output.One can predict that
A) new firms will enter the industry. 
B) old firms will exit the industry. 
C) the number of firms in the industry is stable. 
D) the price must rise. 
E) firms will attempt to lower their implicit costs.

Quizplus · Accepted Answer

If all firms are producing 15 units and the industry is profitable, new firms will enter the industry to take advantage of the profits.

-Use the Data in the Table Above