Use the following to answer questions :
Figure 8-1
-In Figure 8-1, the long run equilibrium competitive price is:
A)$5.
B)$7.
C)$10.
D)greater than $10.
E)some positive number that cannot be determined without seeing the market demand curve.

Question

Use the following to answer questions :
Figure 8-1 
-In Figure 8-1, the long run equilibrium competitive price is:
A)$5. 
B)$7. 
C)$10. 
D)greater than $10. 
E)some positive number that cannot be determined without seeing the market demand curve.

Quizplus · Accepted Answer

In a long run equilibrium in a perfectly competitive market, price will equal marginal cost. In this figure, the long run equilibrium occurs at the intersection of the marginal cost curve and the demand curve, which is at a price of $10. Therefore, the correct answer is (C).

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