Lawn mowing is a perfectly competitive industry.Alex's Lawn-Mowing Service should close if Alex expects his long-run economic profits to equal zero.

Question

Quizplus · Accepted Answer

In a perfectly competitive industry, firms can expect to earn zero economic profit in the long run due to free entry and exit in the market, which is considered a normal condition for long-term equilibrium, not a reason to close.

Lawn Mowing Is a Perfectly Competitive Industry