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It is possible for a firm in perfect competition to earn long run economic profit. true or false

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User JYX
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1 Answer

3 votes

Final answer:

In the long run, perfectly competitive markets will attain long-run equilibrium when no new firms want to enter the market and existing firms do not want to leave the market, as economic profits have been driven down to zero.

Step-by-step explanation:

In the long run, positive economic profits will attract competition as other firms enter the market. Economic losses will cause firms to exit the market. Ultimately, perfectly competitive markets will attain long-run equilibrium when no new firms want to enter the market and existing firms do not want to leave the market, as economic profits have been driven down to zero.

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User Simant
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