In the Long Run,existing Firms Exit a Perfectly Competitive Market

question 63

Multiple Choice

In the long run,existing firms exit a perfectly competitive market

• A) only if economic profits are zero.
• B) if they make a positive economic profit.
• C) if normal profits are greater than zero.
• D) only if they incur an economic loss.
• E) if they either make a normal profit or if they incur an economic loss.

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Definitions:

Demand Curve

A graphical representation of the relationship between the price of a good and the quantity demanded.

Labor

Utilization of human physical and mental capabilities in the generation of goods and services.

Great Recession

The significant global economic downturn that occurred from late 2007 through mid-2009, characterized by widespread financial crisis, high unemployment, and declines in the housing market.

Labor Supply Curve

A graphical representation showing the relationship between the number of labor hours workers are willing to work at various wage levels.