Suppose That the Market for Candy Canes Operates Under Conditions

Multiple Choice

Suppose that the market for candy canes operates under conditions of perfect competition,that it is initially in long-run equilibrium,that the price of each candy cane is $0.10,and that the market demand curve is downward sloping.The price of sugar rises,increasing the marginal and average total costs of producing candy canes by $0.05.In the short run,a typical producer of candy canes will be making:

A) an economic profit.
B) zero economic profit.
C) negative economic profit.
D) The answer is impossible to determine from the information given.