Assuming a Horizontal Long-Run Market Supply Curve,which of the Following

question 6

Multiple Choice

Assuming a horizontal long-run market supply curve,which of the following statements is (are) TRUE about competitive firms in the long run?

• A) p = MC
• B) p = AC
• C) profit = 0
• D) All of the above.

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Definitions:

Elastic Demand

A situation where the quantity demanded of a good or service changes significantly due to a change in its price.

Marginal Revenue Curve

A curve that shows the change in total revenue resulting from selling one additional unit of a product or service.

Standardized Product

Products that are uniform in quality and features, offering no significant difference from the same products offered by other sellers.

Differentiated Product

A product that is distinct from similar products offered by competitors, often through quality, features, or branding.