Question

Suppose a firm in a perfectly competitive market is earning normal profits and there is an increase in demand. In the short​ run, the firm earns A. an economic profit as prices rise. In the long​ run, new firms will enter and prices will rise. B. an economic profit as prices fall. In the long​ run, new firms will enter and prices will rise. C. an economic profit as prices rise. In the long​ run, new firms will enter and prices will fall. D. an economic profit as prices fall. In the long​ run, new firms will enter and prices will fall.

Answer 1