Question
The constant cost perfectly competitive market for lollipops is in a long run equilibrium.A change in tastes and preferences has led to an increase in
The constant cost perfectly competitive market for lollipops is in a long run equilibrium.A change in tastes and preferences has led to an increase in the demand for lollipops.In order to return to long run equilibrium, the resulting increase in price will result in
Group of answer choices
A.greater than normal profits for firms, which will lead some firms to leave the industry and thus result in an even greater price increase.
B.lower than normal profits for firms, which will attract new firms. which in turn will result in a reduction in the price.
C.greater than normal profits for firms, which will attract new firms, which in turn will result in a reduction in the price.
D.lower than normal profits, which will lead some firms to leave the industry and thus result in an even greater price increase.
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