Asked by
Michael Terrell
on Oct 08, 2024
Verified
When a purely competitive firm is in long-run equilibrium:
A) marginal revenue exceeds marginal cost.
B) price equals marginal cost.
C) total revenue exceeds total cost.
D) minimum average total cost is less than the product price.
Long-Run Equilibrium
A state in which all firms in a market or industry are making normal profits, and there is no incentive for existing firms to exit the market or for new firms to enter.
Marginal Cost
The expenditure associated with creating one more unit of a good or service.
Total Revenue
The complete amount of money received by a company for goods sold or services provided during a specific period.
- Gain insight into the connection between price, average total cost, and marginal cost within the context of long-term equilibrium.
Verified Answer
SB
Learning Objectives
- Gain insight into the connection between price, average total cost, and marginal cost within the context of long-term equilibrium.