Which of the Following Is a Characteristic of a Perfectly

question 6

Multiple Choice

Which of the following is a characteristic of a perfectly competitive industry in long-run equilibrium?

• A)A profit-maximizing firm may produce any output level at which P < LRATC.
• B)Every firm produces at an output level at which MC > LRATC.
• C)Firms will continue to enter or exit the industry.
• D)No firm earns an economic profit.
• E)Every firm earns an economic profit.

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Definitions:

Rate Of Interest

The percentage at which interest is charged or paid over a specific period of time on borrowed or saved money.

Unsecured Loan

A loan that is issued and supported only by the borrower's creditworthiness, without any collateral.

Short-Term Loan

A type of loan that is scheduled to be repaid in less than a year.

Equity Financing

The sale of common stock or the use of retained earnings to provide long-term financing.