Asked by
Manoj Kumar
on Nov 27, 2024
Verified
The representative firm in a purely competitive industry
A) will always earn a profit in the short run.
B) may earn either an economic profit or a loss in the long run.
C) will always earn an economic profit in the long run.
D) will earn zero economic profit in the long run.
Purely Competitive Industry
A market structure characterized by many small firms producing identical products, with no single firm able to influence market prices.
Long Run
A period of time in economics where all factors of production and costs can be varied, allowing for the adjustment of all inputs.
- Recognize that, in the course of time, the nature of perfectly competitive markets leads to the elimination of economic profits through the dynamics of firm entry or departure.
Verified Answer
MA
Learning Objectives
- Recognize that, in the course of time, the nature of perfectly competitive markets leads to the elimination of economic profits through the dynamics of firm entry or departure.
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