17. In the long run, due to the increase in the price of petroleum, what would we expect to observe within individual firms in the plastic knob industry relative to the short run equilibrium which occurred after petroleum prices rose? (Do not compare relative to the initial equilibrium before petroleum prices rose.)
  1. prices rise, output falls, losses shrink.
  2. prices rise, output increases, losses shrink.
  3. price fall, output increases, and profits grow.
  4. price fall, output falls, and losses grow.
  5. price stay unchanged, output falls, and losses grow.

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