[Solved] Suppose Your Trucking Firm in a Perfectly Competitive Industry Is

Question 88
Multiple Choice
arrowQuestion 88arrow

Suppose your trucking firm in a perfectly competitive industry is making zero economic profits in the short run.The federal government imposes a new safety regulation that affects all firms,thus shifting the marginal cost curve upward.As a result your firm's profit maximizing short-run output will

A)decrease because the new MC curve will intersect the horizontal demand curve at a lower rate of output.
B)remain the same because you will pass on the extra costs to the consumers.
C)remain the same since the new regulation does not affect ATC.
D)increase as firms will leave the industry at the higher costs,thus driving up the market price.
E)increase as price rises in the long run.


10+ million students use Quizplus to study and prepare for their homework, quizzes and exams through 20m+ questions in 300k quizzes.


Explore our library and get Economics Homework Help with various study sets and a huge amount of quizzes and questions

Related Questions

Get Free Access Now!

Get free access by uploading any valuable academic documents


Invite your friends by sharing your unique referral link, and get a free access

Invite a friendInvite a friendInvite a friend
Join Us
Join Us

Sign up to get 5 free question for every quiz you visit. Or Subscribe and get instant access