In the long-run equilibrium of a competitive market, the number of firms in the market adjusts until the market demand is satisfied at a price equal to the minimum of
A)average fixed cost for the marginal firm.
B)marginal cost of the marginal firm.
C)average total cost of the marginal firm.
D)average variable cost of the marginal firm.

Question

Quizplus · Accepted Answer

In the long-run equilibrium of a competitive market, firms enter and exit the market until the price equals the minimum average total cost (ATC) of the marginal firm, ensuring zero economic profit.

In the Long-Run Equilibrium of a Competitive Market, the Number