If the market demand for the product increases, in the short run a purely competitive firm:
A) Will experience no change in costs as it steps up production in response to the change in the
market
B) Will not change its output quantity because there are so many firms that the individual firm
will not be affected by the change
C) Can employ more inputs and increase the size of its plant, to respond to the change in the
market
D) Will earn higher profits or experience smaller losses as a result of the change in the market
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