If firms in a perfectly competitive industry are earning losses, we would expect that in the long runthe market demand curve for the product will shift to the left causing industry output to fall.the market supply curve for the product will shift to the left causing industry output to fall.the market supply curve for the product will shift to the right causing industry output to rise.the market demand curve for the product will shift to the right causing industry output to rise. there will be no change in industry output as long as marginal revenue equals marginal cost for the individual firms.

Answered: If firms in a perfectly competitive…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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If firms in a perfectly competitive industry are earning losses, we would expect that in the long run

the market demand curve for the product will shift to the left causing industry output to fall.
the market supply curve for the product will shift to the left causing industry output to fall.
the market supply curve for the product will shift to the right causing industry output to rise.
the market demand curve for the product will shift to the right causing industry output to rise.
there will be no change in industry output as long as marginal revenue equals marginal cost for the individual firms.

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