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3 years ago

A firm in a perfectly competitive industry in long-run equilibrium will earn normal returns and zero economic profit.

Business

1 answer:

mina [271]3 years ago

6 0

Answer:

This statement is true.

Explanation:

In a perfectly competitive market, there are a large number of firms in the market. There is no barriers to entry to exit in the market. The firms are producing homogenous products.

The firms in this market will earn positive profits in the short run as in short run, the firms can't enter the market.

In the long run, though the firms will be attracted to the positive profits earned by the existing firms to enter the market.

This will cause the supply in the market to increase, this increase in the supply will shift the supply curve to the left. This leftward shift in the supply curve will reduce the price of the product.

The market share and profits of the individual firms will decline. This will continue till the profits are reduced to zero.

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skelet666 [1.2K]

Answer:

Withheld from employee pay.

Explanation:

Your paycheck stub should show the following withholdings:

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2) Federal income taxes (depends on income bracket)

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3 years ago

Read 2 more answers

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Flura [38]

Answer:

a. A jeweler observes the price of gold rise and wonders if there is a shortage of gold.

Costs imposes by Inflation: Price confusion

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Costs imposes by Inflation: Menu costs

c. Your grandmother's savings account pays 2% interest, but inflation is 5%.

Costs imposes by Inflation: Wealth redistribution

d. The CEO of GM worries that his revenue received in the future won't cover the expenses he incurs today.

Costs imposes by Inflation: Not associated with listed cost

e. Jim is reluctant to sell his stocks at the end of the year.

Costs imposes by Inflation: Not associated with listed cost

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Costs imposes by Inflation: Money illusion

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2 years ago

a-1. Based on the preceding information, recommend whether to eliminate Division B. a-2. Prepare companywide income statements b

Gekata [30.6K]

Answer:

solomon is supposed to continue production at Division B because of the increase in the production volume and sales volume that has increased.

Explanation:

Solomon should take the risk of continuing in the business for like a certian period so that he can be able to asses the production fully before making a decision of probably Subleasing the facility.

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3 years ago

What is the key factor in rural development ?

PtichkaEL [24]

Letter C is your answer.

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3 years ago

In the challenging world of retail sales, Macy's, Inc.'s (M's) revenues are declining while expenses are generally flat. Based o

Papessa [141]

Answer

a) Gordon's Constant Growth model : P0 = D1 / (r-g)

r = 3% =0.03 , g= -7% = -0.07 , D0 = $5.1

D1 = D0*(1+g)

D1 = 5.1*(1-0.07)

D1 = $4.743

P0 = 4.743/(0.03- (-0.07))

P0 = 4.743/0.10

P0 = $47.43

So, Stock M should sell at a price of $47.43 today

b) Price 8 years from now

==> P8 = D9/(r-g)

P8 = D0*(1+g)^9/(r-g)

P8 = 5.1* (1-0.07)^9 / (0.03- (-0.07))

P8 = 5.1*0.52041108298 / (0.03- (-0.07))

P8 = 2.65410

P8 = $26.54

c) Investor may want to buy the stock today for the Dividends. If the dividends paid are high enough, the present value of the dividends is also high and may more than compensate the fall in stock price. This type of stocks work and give cash flows like a project where the initial cashflows are higher and later cashflows are less because of market factors.

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2 years ago

A firm in a perfectly competitive industry in​ long-run equilibrium will earn normal returns and zero economic profit.

A firm in a perfectly competitive industry in long-run equilibrium will earn normal returns and zero economic profit.