In the long run, a firm earns zero economic profit, given the condition that

Name: In the long run, a firm earns zero economic profit, given the condition that
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Question

Quizplus · Accepted Answer

If the firm is earning zero economic profit, it means that its revenue (P) is equal to its total costs (ATC). This is because if P was greater than ATC, the firm would be earning a positive economic profit, and if P was less than ATC, the firm would be incurring a loss. Therefore, the best choice is C, where P = ATC.

In the Long Run, a Firm Earns Zero Economic Profit