A perfectly competitive industry in long-run equilibrium is described as efficient because firms

Question

Quizplus · Accepted Answer

In a perfectly competitive industry in long-run equilibrium, firms produce at the minimum point on their average cost curve, which implies that they are producing at the lowest possible cost. This level of output is considered efficient because no other firm can produce at a lower cost, and any increase in output beyond this point would result in a higher cost per unit of output.

A Perfectly Competitive Industry in Long-Run Equilibrium Is Described as Efficient