Consider the Textile Industry,which We Assume to Be a Competitive

Multiple Choice

Consider the textile industry,which we assume to be a competitive industry,and which experiences continuous cost-reducing technological change.Which of the following statements best describes this industry?

A) High-cost textile mills will co-exist with low-cost mills as long as the revenue for the high-cost mills is covering their variable costs.
B) The price of the product is determined by the minimum ATC of the lowest-cost plants.
C) All textile mills in the industry will be earning zero economic profits or losses.
D) Both A and B
E) Both B and C