Question
Suppose Bella's Belt Barn operates in a perfectly competitive market and is producing its profit-maximizing level of output. Suppose further that at this level of
Suppose Bella's Belt Barn operates in a perfectly competitive market and is producing its profit-maximizing level of output. Suppose further that at this level of production, Bella's average fixed cost of producing belts is $2.40, average variable cost is $21.30, and marginal cost is $23.70. At this moment, Bella is earning _____ economic profits. Over time, everything else held constant, the price of belts in this market will _____.
Select one:
A.positive; increase
B.negative; decrease
C.zero; remain unchanged
D.positive; decrease
E.negative; increase
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