Martha runs a business that makes designer jeans. Each of the seamstresses she employs uses one of the sewing machines on the factory floor. In the short run, the seamstresses are afactor of production and the sewing machines are a fixed factor of production. The output of each seamstress is considered theproduct.

Martha is one producer in the perfectly competitive jelly industry. last year, martha and all of her competitors found themselves earning economic profits. if there is free entry and exit, what do you expect to happen to the number of suppliers in the industry and the price of jelly? the number of suppliers will increase, and the price of jelly will fall. the number of suppliers will decrease, and the price of jelly will increase. the number of suppliers will increase, and the price of jelly will increase. the number of suppliers will decrease, and the price of jelly will fall.