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Unformatted text preview: market or any input market maximized 6. The demand curve 6. Firms will enter the industry 6. Prices and quantities facing each firm is infinitely if the existing firms earn respond quickly to elastic (horizontal) at the excess profits changes in demand market price and supply 7. The market supply curve 7. Firms will exit the industry 7. In the long run, only is the horizontal sum of in the long run if firms are efficient firms will each firm's MC curve taking losses, but P > min AVC, remain above minimum AVC and exit in the short run if P < min AVC...
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- Spring '07