When Market Conditions in a Competitive Industry Are Such That

Multiple Choice

When market conditions in a competitive industry are such that firms cannot cover their total production costs, then

A) the firms will suffer long-run economic losses.
B) the firms will suffer short-run economic losses that will be exactly offset by long-run economic profits.
C) some firms will exit the market, causing prices to rise until the remaining firms can cover their total production costs.
D) all firms will go out of business, since consumers will not pay prices that enable firms to cover their total production costs.