A Perfectly Competitive Firm Cannot Make Economic Profits in the Long

question 67

Multiple Choice

A perfectly competitive firm cannot make economic profits in the long run because:

• A) it is a price taker.
• B) there are no barriers to entry into the industry.
• C) it faces a perfectly elastic demand curve.
• D) its advertising costs will rise to eliminate any economic profits.

Determine the effect of changes in input or output levels on a firm's cost and revenue.

Calculate opportunity costs in different scenarios.

Analyze the characteristics and implications of a natural monopoly.

Explain the impact of technological advancements on production costs.

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