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Illustrate the zero-profit theorem, using separate diagrams for the firm and industry. a) If firms in an industry are currently earning profits, would you expect

Illustrate the "zero-profit theorem," using separate diagrams for the firm and industry.

a) If firms in an industry are currently earning profits, would you expect the output of an individual firm to rise or fall over time?

b) After zero-profit equilibrium is reached, will all firms be earning zero economic profits or just the "marginal" firm?

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