Figure: The Restaurant Market (Figure: The Restaurant Market) The figure The Restaurant Market shows curves facing a typical restaurant in a community.Assume that many firms, differentiated products, and easy entry and easy exit characterize the restaurant market.In long-run equilibrium, the economic profit earned by the typical restaurant in the community will be:

Question

Figure: The Restaurant Market  (Figure: The Restaurant Market) The figure The Restaurant Market shows curves facing a typical restaurant in a community.Assume that many firms, differentiated products, and easy entry and easy exit characterize the restaurant market.In long-run equilibrium, the economic profit earned by the typical restaurant in the community will be:

Quizplus · Accepted Answer

In a perfectly competitive market, long-run equilibrium occurs when economic profit is zero. Since the market is characterized as having many firms, differentiated products, and easy entry and exit, it is assumed to be a competitive market. Therefore, the economic profit earned by the typical restaurant in the community will be zero in the long run.

Figure: the Restaurant Market (Figure: the Restaurant Market) the Figure