Suppose a perfectly competitive market is in equilibrium and demand for the product decreases O in the long-run some firms will exit and profit will eventually be positive. in the long-run some firms will enter and profit will eventually be zero. in the long-run some firms will enter and profit will eventually be positive. O in the long-run some firms will exit and profit will eventually be zero.

Suppose a perfectly competitive market is in equilibrium and demand for the product decreases O in the long-run some firms will exit and profit will eventually be positive. in the long-run some firms will enter and profit will eventually be zero. in the long-run some firms will enter and profit will eventually be positive. O in the long-run some firms will exit and profit will eventually be zero.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter8: Perfect Competition

Section: Chapter Questions

Problem 1SCQ: Firms ill a perfectly competitive market are said to be price takers that is, once the market...

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Firms ill a perfectly competitive market are said to be price takers that is, once the market determines an equilibrium price for the product, firms must accept this price. If you sell a product in a perfectly competitive market, but you are not happy with its price, would you raise the price, even by a cent?
Consider the perfectly competitive market for apples, which is currently in long-run equilibrium. Now the government decreases the annual license fee, which is needed to operate the business. We would expect that O Firms enter the industry in the short-run O Firms decreases the quantity produced in the short-run O Firms make more money in the short-run O Firms increase the quantity produced in the short-run
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Suppose a perfectly competitive market is in equilibrium and demand for the product increases O in the short-run firms will have positive profit. O in the long-run firms will have positive profit. O in the short- run firms will have negative profit. O in the long-run firms will have negative profit.
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