Ask Question
4 November, 14:06

If the market price of a good is more than the opportunity cost of producing it, a. the market price of the product will increase in the long run. b. producers will increase supply in the long run. c. resources will flow away from production of the good, causing supply to decline with the passage of time. d. the situation will remain unchanged as long as supply and demand remain in balance.

+3
Answers (1)
  1. 4 November, 16:52
    0
    B.

    Explanation:

    If the price of a good or service is higher than its opportunity cost (what producers sacrify when they produce the good), the producers are having positive benefits. Economic benefits are measure by the sum of total income minus the sum of total expenses. In this case, producer's income is price and producer's expense is the opportunity cost. In a perfect competitive market, there is complete information and no barriers to entry, so if people notice that producers are having positive benefits, they will like to enter to the market. In the long-run there would be more firms than before and for instance total supply will increase.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “If the market price of a good is more than the opportunity cost of producing it, a. the market price of the product will increase in the ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers