In perfectly competitive long-run equilibrium:

Question

Quizplus · Accepted Answer

In long-run equilibrium, firms will produce at the minimum point of their average total cost curves. This is because in perfect competition, firms have no pricing power and must accept the market price. If a firm were to produce at a point above the minimum of its average total cost curve, it would not be able to compete with other firms in the market and would eventually exit the market. As a result, all firms will produce at the minimum point of their average total cost curves, ensuring productive efficiency.

In Perfectly Competitive Long-Run Equilibrium