Roots Wholefoods sells fruit and vegetables in a perfectly competitive market. Which of these statements about the decisions which it faces is true? a) Its downward sloping demand curve ensures that it can make economic profits. b) Its constant returns to scale in production ensures that it faces constant marginal costs. c) It does not have to worry about the entry of other firms, ensuring that its profits can last for a long time. d) In the long run, it expects to make zero economic (or supernormal) profits.
Roots Wholefoods sells fruit and vegetables in a perfectly competitive market. Which of these statements about the decisions which it faces is true? a) Its downward sloping demand curve ensures that it can make economic profits. b) Its constant returns to scale in production ensures that it faces constant marginal costs. c) It does not have to worry about the entry of other firms, ensuring that its profits can last for a long time. d) In the long run, it expects to make zero economic (or supernormal) profits.
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter9: Market Structure And Long-run Equilibrium
Section: Chapter Questions
Problem 1MC
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Roots Wholefoods sells fruit and vegetables in a
a) Its downward sloping demand curve ensures that it can make economic profits.
b) Its constant returns to scale in production ensures that it faces constant marginal costs.
c) It does not have to worry about the entry of other firms, ensuring that its profits can last for a long time.
d) In the long run, it expects to make zero economic (or supernormal) profits.
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