Industries in which firms are suffering losses are likely to ________ in the long run.
A) expand
B) contract
C) neither expand nor contract, as firms must earn an economic profit to stay in business
D) expand or contract depending on the normal rate of return

Question

Quizplus · Accepted Answer

Industries where firms are consistently suffering losses are likely to contract in the long run as firms exit the industry due to unprofitability, reducing the industry's overall size.

Industries in Which Firms Are Suffering Losses Are Likely to ________