Because there is significant freedom of entry and exit of firms in the retail sale of gasoline,

Question

Quizplus · Accepted Answer

In markets with significant freedom of entry and exit, firms tend to earn normal profits in the long run because if profits are above normal, new firms enter the market, increasing supply and reducing prices and profits. Conversely, if profits are below normal, firms exit the market, reducing supply and increasing prices and profits until they reach normal levels.

Because There Is Significant Freedom of Entry and Exit of Firms