The following companies have different financial statistics. Turtle Co. Hare Corp. Growth rate in sales and earnings 4 % 18 % Cash as a percentage of total assets 22 4 a. What dividend policy would you recommend for Turtle Co.

Which of the following statements is (are) true? i. free entry to a perfectly competitive industry results in the industry's firms earning zero economic profit in the long run, except for the most efficient producers, who may earn economic rent. ii. in a perfectly competitive market, long-run equilibrium is characterized by lmc < p < latc. iii. if a competitive industry is in long-run equilibrium, a decrease in demand causes firms to earn negative profit because the market price will fall below average total cost.