Does a shift in long run average cost change distribution of firms in the market?

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Microeconomics

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Analyze Costs in the Long run

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Paramjeet ChawlaLv8

29 Oct 2020

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A5. If factor prices decrease, (A) (B) both the long-run and short-run average cost curves will shift downward. here will be a downward shift in the long-run average cost curve but not in the short-run average cost curve. a firm will move down along its long-run average cost curve only. a firm will move down along both its long-run and short-run average cost curves. there will be no change in the cost curves in the long run. (D) (E)

If aggregate demand shifts right then in the short run:

a. firms will increase production. In the long run, increased price expectations shift the short-run aggregate supply curve to the left.

b. firms will increase production. In the long run, increased price expectations shift the short-run aggregate supply curve to the right.

c. firms will decrease production. In the long run, increased price expectations shift the short-run aggregate supply curve to the left.

d. firms will decrease production. In the long run, increased price expectations shift the short-run aggregate supply curve to the right.

redraven98

If short-run economic profits are greater than zero for firms in a monopolistically competitive market, in the long-run, we expect:

A) entry barriers to prevent competing firms from entering this market.
B) profits to increase.
C) competing firms to enter the market and sell similar products.
D) the demand curve for firms in the market to shift to the right.

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Does a shift in long run average cost change distribution of firms in the market?

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