if demand for the good decreases creating economic losses firms will exit the industry in the long run as firms exit in the long

Question

Levart [38]

4 years ago

9

if demand for the good decreases creating economic losses firms will exit the industry in the long run as firms exit in the long

run industry supply will _ and market price will _

Business

1 answer:

Art [367] · Answer 1 · 2022-02-07T01:08:32+03:00

Answer:

The correct answer is: decrease; increase.

Explanation:

There is a decrease in demand when the curve shifts to the left and down. It is determined by:

Decrease in consumer income

Increase in the price of complementary goods

Decrease in the price of substitute goods

Change of consumer preferences.

The decrease in demand means that even the same price, less quantity of the good is demanded or when the price decreases buying the same quantity of the good.