The demand for coffee increases and coffee producers begin


The demand for coffee increases and coffee producers begin earning economic profits. Assume the coffee industry is perfectly competitive. Compared to this new situation, in the long run how are the price of coffee and economic profits for coffee producers most likely to change? Hint: Read the question carefully. You are asked to compare the situation AFTER the demand increases to the long-run. A) Economic Profits Decreases & Price Decreases B) Economic Profits Decreases & Price Increases C) Economic Profits Increases & Price Decreases D) Economic Profits Increases & Price Increases

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Business Economics: The demand for coffee increases and coffee producers begin
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