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Refer to the diagrams, which pertain to a purely competitive firm producing output q and the industry in which it operates. In the long run we should expect: Multiple Choice firms to enter the industry, market supply to rise, and product price to fall. firms to leave the industry, market supply to rise, and product price to fall. firms to leave the industry, market supply to fall, and product price to rise. no change in the number of firms in this industry.

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Answer: Firms to leave the industry, market supply to fall, and product price to rise

Explanation:

As can be seen from this diagram, prices and marginal revenue are below the Average Total Cost which means that the companies in this market are incurring losses.

In the long run therefore, companies will exit the market to avoid those losses. This will lead to market supply falling as there are now fewer sellers and producers. This will then cause the product price to rise again.

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