In a Perfectly Competitive Market, the Process of Entry and Exit

question 131

Multiple Choice

In a perfectly competitive market, the process of entry and exit will end when firms in the market:

• A)are making zero economic profit
• B)are operating with excess capacity
• C)capture market power
• D)experience decreasing marginal revenue

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Definitions:

Random

Lacking any definite plan or order or purpose; governed by or depending on chance.

Male and Female

Categories that describe an individual’s sex, based on biological differences, within a binary framework.

Probability

An indicator of how probable it is for an event to happen, represented by a number ranging from 0 to 1.

Births

The occurrence of bringing forth a new individual from a parent organism, initiating a new life.