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Suppose When a Market Has Four Firms,average Economic Profit Is

Question 156

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Suppose when a market has four firms,average economic profit is $1,000 per month.When the market has five firms,the average economic profit is -$50 per month.This suggests that


A) the long-run equilibrium number of firms is between four and five.
B) the long-run equilibrium number of firms is four.
C) the long-run equilibrium number of firms is five.
D) there is no long-run equilibrium in this market as profits can never be zero.

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