In the Long Run, a Firm Will Enter a Competitive

question 14

Multiple Choice

In the long run, a firm will enter a competitive industry if

• A)total revenue exceeds total cost.
• B)the price exceeds average total cost.
• C)the firm can earn economic profits.
• D)All of the above are correct.

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Definitions:

Assets

Resources owned by a company that have economic value and can provide future benefits.

Future Benefits

The projected economic advantages to be received from an investment, often used in evaluating the potential return from capital projects or investments.

Net Income

The amount of earnings remaining after all expenses, including taxes and costs, have been subtracted from total revenue.

Revenues

The total amount of money received by a company for goods sold or services provided during a specific period, before any deductions.