What effect decrease in demand will cause


Assume a decreasing-cost industry that is initially in long-run competitive equilibrium. A decrease in demand will cause a(n) __________ in prices and profits, and as a result, firms will __________ the industry, causing the market supply curve to shift __________,which, in turn, will eventually cause the equilibrium price to be __________ before.

(a)a decrease; exit; rightward; lower than

(b)an increase; enter; rightward; higher than

(C)a decrease; exit; leftward; higher than

(D)an increase; enter; rightward; the same as

(E)an increase; exit; leftward; lower than.

 

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Microeconomics: What effect decrease in demand will cause
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