If some firms in the industry make an economic profit,then

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Quizplus · Accepted Answer

If some firms are making an economic profit, it indicates that the market price is higher than the average total cost for those firms. This situation creates an incentive for other firms to enter the industry to also make a profit. Therefore, in the long run, the supply of goods will increase, the market price will decrease, and economic profits will be eliminated. This process will continue until all firms in the industry are making only a normal profit. This implies that the industry is not perfectly competitive and there are no barriers to entry. Therefore, option C is the best choice.

If Some Firms in the Industry Make an Economic Profit,then