The ability of firms to enter and exit a market over time means that, in the long run, a. the demand curve is more elastic. b. the demand curve is less elastic. c. the supply curve... The ability of firms to enter and exit a market over time means that, in the long run, a. the demand curve is more elastic. b. the demand curve is less elastic. c. the supply curve is more elastic. d. the supply curve is less elastic.
Understand the Problem
The question is asking about the implications of firms being able to enter and exit a market over time, specifically how this affects the elasticity of the demand and supply curves in the long run.
Answer
The supply curve is more elastic.
The final answer is that the supply curve is more elastic.
Answer for screen readers
The final answer is that the supply curve is more elastic.
More Information
In the long run, the ability of firms to enter or exit a market easily allows for adjustments in production quantities in response to price changes. This flexibility makes the supply curve more elastic, meaning it can adjust more readily to changes in market conditions.
Tips
A common mistake is confusing the elasticity of supply with the elasticity of demand. In this context, supply is affected by firm entry and exit, not demand.
Sources
- The web page with info on - Example Source - vaia.com
- The ability of firms to enter and exit a market over time means that, in ... - homework.study.com
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