When Firms Are Neither Entering nor Exiting a Perfectly Competitive

question 100

Multiple Choice

When firms are neither entering nor exiting a perfectly competitive market,

• A)total revenue must equal total cost for each firm.
• B)economic profits must be zero.
• C)price must equal the minimum of marginal cost for each firm.
• D)Both a and b are correct.

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Definitions:

Perpetual

Continuing indefinitely without interruption; in accounting, it often refers to systems that continuously update inventory or records.

Inventory System

A method or system used to plan, organize, and control the goods or materials that are held in stock, ensuring efficient management and use of inventory.

Costly

Involving high expenses; describing something that requires significant financial outlay.

Periodic Inventory Systems

Periodic Inventory Systems is an inventory management method where inventory levels are updated and physical counts are conducted at specific intervals, typically at the end of an accounting period.