Answer to Question #107255 in Microeconomics for Teekay

Question

If a monopolistically competitive industry is in long-run equilibrium and suddenly the cost of resources increases, then:

Select one:
a.
some firms will eventually leave the industry.

b.
new firms will eventually enter the industry.

c.
the demand and average-revenue curves will shift to the left.

d.
the cost structure of the firm will shift down.

e.
the demand and average-revenue curves will shift to the right.

Answer 1

a. some firms will eventually leave the industry