Asked by
Carina Torres
on Nov 16, 2024
Verified
The marginal firm in a competitive market will earn zero economic profit in the long run.
Zero Economic Profit
A situation where a firm's total revenues are exactly equal to its total costs, including opportunity costs, typically occurring in perfect competition in the long run.
Marginal Firm
A business that operates at the minimum level of profitability where any decrease in market prices would cause it to exit the market.
- Understand the conditions that lead to zero economic profit in the long run within perfectly competitive markets.
Verified Answer
NB
Learning Objectives
- Understand the conditions that lead to zero economic profit in the long run within perfectly competitive markets.
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