A perfectly competitive firm initially is earning zero economic profit. Then, a decrease in demand for the firm's product occurs. Of the following, in the long run which action listed below is the firm most likely to take?
A) Increase the quantity it produces.
B) Increase its advertising to increase the demand for its product.
C) Exit the market.
D) Increase the size of its plant.
Question 2
Because of their higher value of marginal product
A) the demand curve for high-skilled workers lies to the right of the demand curve for low-skilled workers.
B) the demand curve for high-skilled workers lies to the left of the demand curve for low-skilled workers.
C) the supply curve for high-skilled workers lies to the right of the supply curve for low-skilled workers.
D) the demand curve for high-skilled workers lies to the left of the supply curve for low-skilled workers.
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