Asked by
Julia Hughes
on Oct 27, 2024Verified
If some firms in a perfectly competitive industry are earning positive economic profits,then in the long run,the:
A) industry is in equilibrium.
B) short-run industry supply curve will shift to the right.
C) number of firms in the industry will not change.
D) number of firms in the industry will decrease.
Economic Profits
Profits that exceed the costs of all inputs, including both explicit costs (like wages and materials) and implicit costs (like the opportunity cost of capital).
Industry Equilibrium
A state where supply and demand in an industry are balanced, leading to stable prices and quantities.
- Elucidate the function of firms entering and exiting in establishing long-run equilibrium within a perfectly competitive market.
Verified Answer
LM
Learning Objectives
- Elucidate the function of firms entering and exiting in establishing long-run equilibrium within a perfectly competitive market.
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