Long-Run Equilibrium Occurs in a Competitive Market When

question 9

Multiple Choice

Long-run equilibrium occurs in a competitive market when

• A)economic profit and economic loss have been eliminated.
• B)no barriers to entry exist.
• C)all firms are operating at their shutdown points.
• D)price equals marginal cost.
• E)none of the above.

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Definitions:

Joint Venture

A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task.

Fair Value

The fund received from an asset sale or the cost for a liability shift in a smoothly facilitated transaction among participants of the market on the price determination date.

Capital Cost Allowance

A taxable expense in Canada that allows a business to deduct the cost of a capital asset over time.

Half-Year Rule

A tax rule in some jurisdictions that allows only half the usual depreciation expense deduction in the year that a capital asset is acquired.