For a perfectly competitive industry, an increase in market demand will result in Exit of some firms Long-run Industry supply that is horizontal Economic profits in the long run Price at minimum AVC in the long run

For a perfectly competitive industry, an increase in market demand will result in Exit of some firms Long-run Industry supply that is horizontal Economic profits in the long run Price at minimum AVC in the long run

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter8: Perefect Competition

Section: Chapter Questions

Problem 18SQ

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Concept explainers

Short-Run Costs and Long-Run Costs

Cost of short-run and the long-run is an economic term that describes the cost involved in the production of goods in a firm in the short as well as long period.

Question

For a perfectly competitive industry, an increase in market demand will result in

	Exit of some firms
	Long-run Industry supply that is horizontal
	Economic profits in the long run
	Price at minimum AVC in the long run

Definition Definition Structure of the market that exists when many buyers and sellers exchange similar commodities and prices are fixed by market forces, demand, and supply. When there is perfect competition, a single business cannot impact the price or market value of the homogenous product.

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