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Quiz· Competition and the Invisible Hand· 2 of 4
Knowledge CheckQuestion 1 of 10

Entrepreneurs shift capital and labor across industries in pursuit of profit. Let’s look at this a little more closely. Suppose there are two industries: a high-profit industry, Industry H, and a low-profit industry, Industry L. Answer the questions below about these two industries. If the two industries have similar costs, then what must be true about prices in the two industries?

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Lesson: The Balance of Industries and Creative Destruction