Author Question: If there is a permanent increase in demand for the product of a perfectly competitive industry, the ... (Read 90 times)

Zulu123 · **on:** Jun 30, 2018

If there is a permanent increase in demand for the product of a perfectly competitive industry, the process of transition to a new long-run equilibrium will include:
a. the entry of new firms.
b. temporarily higher profits.
c. both a and b.
d. neither a nor b.

Question 2

If demand for a good is price elastic, it must also be income elastic.
a. True
b. False
Indicate whether the statement is true or false