Now suppose the patent expires and other firms are free to use the technology. Which of the following statements are true about what happens in the long run? A. The market price falls to P2. B. All firms’ average-total-cost curves decline to ATC2. C. The market price stays at P1. D. All firms make positive profits.

B. All firms’ average-total-cost curves decline to ATC2.

C. The market price stays at P1.

Explanation:

The firm's price equals the minimum of average total cost only in the long run. In the short run, the price may be greater than average total cost, in which case the firm is making profits, or price may be less than average total cost, in which case the firm is making losses. But the situation is different in the long run.

When the average total cost is increasing, the marginal cost is above average total cost. It follows that, when the average total cost is at its minimum, marginal cost is equal to average total cost. Also, when the average variable cost is at its minimum, marginal cost equals the average variable cost.

1   all nations face the problem of scarcity because there are limited resources and unlimited wants. nations do not have enough factors of production to produce everything that their population wants. entrepreneurial resources initiate businesses to make new goods and services; labor resources produce goods and services.

2 there are four factors of production: natural resources, labor resources, capital resources, and entrepreneurial resources. natural resources are raw materials from nature that are used to produce goods. trees, water, and grains are natural resources. some natural resources, such as wheat and cattle, are renewable

3 wants

things that you do not need to have in order to survive, but would like to have

needs

things that you must have in order to survive

goods

physical products

services

tasks that a business perform for customers

resources

items that people can use to make or obtain what they need or want

determine

to settle or decide by choice of alternatives or possiblities

4 i really dont know

answer/// product differentiation;