In the Long Run, Each Firm in a Competitive Industry

question 7

Multiple Choice

In the long run, each firm in a competitive industry earns

• A)zero accounting profits.
• B)zero economic profits.
• C)positive economic profits.
• D)Both a and b are correct.

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Definitions:

Routine Response Behavior

Refers to consumer purchasing decisions made out of habit without much deliberation or product comparison.

Prepurchase Behavior

The actions and processes consumers go through before making the final decision to purchase a product or service.

Problem Recognition

The first step in the consumer decision-making process, where a consumer identifies a need or problem that needs to be solved.

Alternative Evaluation

The phase in the consumer decision process where individuals assess the benefits and drawbacks of different choices available to them before making a purchasing decision.