In which of the following market structures can firms earn economic profits in the long run?
A)perfect competition
B)monopolistic competition
C)monopoly
D)Both b and c are correct.

Question

Quizplus · Accepted Answer

In a monopoly market structure, there is a single firm that dominates the market and has significant market power. This allows the firm to restrict output and increase prices, leading to economic profits in the long run. In perfect competition, firms are price takers and have no market power, resulting in zero economic profits. In monopolistic competition, firms have some degree of control over prices due to product differentiation, but entry of new firms in the long run drives profits to zero.

In Which of the Following Market Structures Can Firms Earn