Notes: Long Run EquilibriumPure Competition$ MC Entry and exist occurs until firms break-even ATC* (zero economic profit) PC P=AR=MR=DFIRMP* = MR = MC = min ATC (MC is increasing) Pure MonopolyQ Extremely high barriers 0 QFIRMto entry prevent entry of other firms. Thus, $ monopolist can earn persistent positive econ. profit in long-run. P ATC* ATC P > MR DFIRM = DMARKET)P > ATC MR (MC is increasing) 0 QFIRMOligopolyBarriers to entry prevents most entry, thus an $ oligopolist can earn a positive econ. profit
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This note was uploaded on 10/26/2009 for the course ECON 180-004-20 taught by Professor Bresnock during the Fall '09 term at UCLA.