A perfectly competitive firm definitely makes an economic profit in the short run if price is

Question

Quizplus · Accepted Answer

A perfectly competitive firm will make an economic profit in the short run if price is greater than average total cost. This is because the firm's marginal revenue, which is equal to the market price, is greater than its marginal cost. As long as price exceeds average total cost, the firm can cover all of its costs, including its fixed costs, and still have something left over as profit.

A Perfectly Competitive Firm Definitely Makes an Economic Profit in the Short