<p>Are the policies for rescinding transfer acceptances the same as freshman admits (no D’s or E’s, etc). I’m pretty sure I’m going to get a D. Either I stink at economics (although I thought I understood it) or my professor is a pain. It’s quite clear that my 4.0 GPA is going to be shot, but I’m more concerned about getting my acceptance rescinded if I get a D. What are the chances?</p>
<p>Also, if there are any Econ people out there who could look at this question and tell me what the major difference is between the two answers it would be greatly appreciated (one is my answer, one is his “key”). And would one of the answers, when compared to the other, justify a failing grade on it?</p>
<li> Suppose Dianas pizza place is very successful and she is earning economic profits. Why wont she be able to earn economic profits in the long run? Explain fully.</li>
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<p>Answer 1. If Diana is earning economic profits we would expect she would attract competitors. It is easy to enter the business so if others realized how much she is making they would open pizza shops too. In the long run entry of new competitors will increase the supply of pizza and reduce the equilibrium price. Eventually economic profits will disappear and all sellers will earn normal profits.</p>
<p>Answer 2. If Diana is making an economic profit, then it will encourage more pizza places to enter the market, or will encourage them to lower their price to get a higher percentage of the market. Since in a purely competitive market, the goal is for MR=MC, the long-run equilibrium will be $0 of economic profit. The changes in competition will cause her market to drop until the $0 equilibrium is reached.</p>