In Long-Run Equilibrium, a Perfectly Competitive Firm Will Produce an Output

question 231

True/False

In long-run equilibrium, a perfectly competitive firm will produce an output level at which its long-run average cost curve is upward sloping.

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Definitions:

Imperfect Competition

A market structure in which no firm is a monopolist, but producers nonetheless have market power they can use to affect market prices.

Oligopoly

A market structure characterized by a small number of firms controlling a large majority of the market share.

Quantity Effect

The impact on total revenue when the quantity sold changes while the price remains the same.

Marginal Cost

The increased expenditure resulting from making an additional unit of a product or service.