In the long run, a perfectly competitive market will
A)produce only the quantity of output that yields a long-run profit for the typical firm.
B)supply whatever amount consumers will buy at a price which earns the market an economic profit.
C)supply whatever amount consumers demand at a price determined by the minimum point on the typical firm's average total cost curve.
D)generate a long-run equilibrium where the typical firm operates at a loss.

Question

Quizplus · Accepted Answer

In the long run, perfectly competitive markets reach an equilibrium where firms produce at the minimum point of their average total cost curve, ensuring no economic profit or loss, as firms can freely enter and exit the market.

In the Long Run, a Perfectly Competitive Market Will