Question 9 1 1 pts in the above figure the left hand

This preview shows page 6 - 8 out of 8 pages.

Question 9 1 / 1 pts
In the above figure, the left hand side graph represents a perfectly competitive industry and the right hand side graph represents a perfectly competitive firm. As the demand curve decreases
Question 10 0 / 1 pts Why do perfectly competitive firms in the long run always make zero economic profit?
You Answered Perfectly competitive firms are price takers. There are many firms in a perfectly competitive market. Correct Answer There are no barriers to entry or exit in perfectly competitive industries. Because there are no barriers to entry or exit in perfectly competitive markets. When firms are making positive economic profit, entry will occur and firms' profit level will decrease. Similarly, when firms are making negative economic profit, exit will occur and remaining firms' profit level will increase. Therefore, perfectly competitive firms will always make negative economic profit in the long run. Quiz Score: 5 out of 10

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture