Assume the market for cage-free eggs is perfectly competitive. All else equal, as more farmers choose to produce and sell cage-free eggs, what is likely to happen to the equilibrium price of the eggs and profits of these farmers in the long run?
- The equilibrium price is likely to remain unchanged and profits are likely to increase
- The equilibrium price is likely to decrease and profits are likely to decrease
- The equilibrium price is likely to increase and profits are likely to remain unchanged
- The equilibrium price is likely to increase and profits are likely to increase