Being a price taker, a perfectly competitive firm cannot receive a producer surplus in the short run.

Question

Quizplus · Accepted Answer

While a perfectly competitive firm may not have control over the price of its products in the short run, it can still earn a producer surplus (the difference between total revenue and variable costs) as long as price is above average variable cost. The amount of producer surplus will depend on the market price and the firm's level of production.

Being a Price Taker, a Perfectly Competitive Firm Cannot Receive