Question

In the long run,A. the number of firms in the market is fixed.B. competitive firms' ATC curves shift upward or downward to ensure that all demand is satisfied.C. competitive firms' profits are zero.D. competitive firms' variable costs are zero.

Answer 1

Answer:C. competitive firms' profits are zero.

Step-by-step explanation: Perfect competition is the highest level of competition where the number of buyers and sellers are large,all firms are price takers,no government intervention,the products are homogeneous,no firm makes extraordinary profits, there is free entry and exit for buyers and sellers etc.

IN THE LONG RUN A PERFECTLY COMPETITIVE FIRM MAKES ZERO PROFITS.