Consider a competitive market with a large number of identical firms.The firms in this market do not use any resources that are available only in limited quantities.In long-run equilibrium,market price

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In the long-run equilibrium of a perfectly competitive market, the firms are making only normal profits. Therefore, the market price must be equal to the minimum point on the firms' average total cost curve. If the market price were higher than this point, firms would be earning excess profits and new firms would enter the market, increasing competition and driving down the price. If the market price were lower than this point, firms would be incurring losses, some firms would exit the market, reducing competition and allowing the price to rise. Therefore, in the long-run equilibrium, market price settles at the minimum point on the firms' average total cost curve, which represents the lowest possible sustainable cost of production for the industry.

Consider a Competitive Market with a Large Number of Identical