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misserz0210 misserz0210
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2 years ago
Suppose your trucking firm in a perfectly competitive industry is making zero economic profits in the short run. The federal government imposes a new safety regulation that affects all firms, thus shifting the marginal cost curve upward. As a result your firm's profit maximizing, short-run output will

▸ remain the same since the new regulation does not affect ATC.

▸ increase as firms will leave the industry at the higher costs, thus driving up the market price.

▸ increase as price rises in the long run.

▸ remain the same because you will pass on the extra costs to the consumers.

▸ decrease because the new MC curve will intersect the horizontal demand curve at a lower rate of output.
Textbook 
Microeconomics

Microeconomics


Edition: 17th
Author:
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awbradshawawbradshaw
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2 years ago
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misserz0210 Author
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2 years ago
this is exactly what I needed
Morgan-C
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Yesterday
Thanks for your help!!
choih94
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2 hours ago
Brilliant ツ
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