Because of free entry and exit, firms in a perfectly competitive market cannot earn a profit in the short run.

Name: Because of free entry and exit, firms in a perfectly competitive market cannot earn a profit in the short run.
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In the short run, firms in a perfectly competitive market can earn profits due to factors like lower costs or higher market prices. However, in the long run, the entry of new firms erodes these profits, leading to normal profit levels.

Because of Free Entry and Exit, Firms in a Perfectly