If a perfectly competitive firm is in long-run equilibrium, then market price is equal to short-run marginal cost, short-run average total cost, long-run marginal cost, and long-run average total cost.

Question

Quizplus · Accepted Answer

In long-run equilibrium under perfect competition, firms adjust their scale of operation such that market price equals not only the short-run marginal cost (SRMC) but also the short-run average total cost (SRATC), long-run marginal cost (LRMC), and long-run average total cost (LRATC), ensuring no economic profit or loss.

If a Perfectly Competitive Firm Is in Long-Run Equilibrium, Then