Economic profits in a system of perfectly competitive markets will be positive in all industries.

Question

Quizplus · Accepted Answer

In a system of perfectly competitive markets, there are no economic profits in the long run. Economic profits may exist in the short run, but firms will enter the market and drive down prices until they reach the point where economic profits are zero. Therefore, economic profits will not be positive in all industries in the long run.

Economic Profits in a System of Perfectly Competitive Markets Will