9. Again, consider the lowering of the drinking age as stated in the prior problem. Our best long run prediction for such an industry is that:

1. due to the reduction in profitability, bars will start to close reducing demand for the remaining bars.
2. due to the increase in profitability more bars will be opened reducing demand for remaining bars.
3. due to the reduction in profitability, bars will start to close increasing demand for the remaining bars.
4. due to the increase in profitability more bars will be opened increasing demand for remaining bars.
5. there will be no change in the number of bars in the long run.

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