If all the firms producing a good in an industry have market shares that are in significant,that is, close to zero percent of industry sales,
A) they shut down, that is, go out of business in the long run
B) their output levels are close to zero as well
C) they are in a perfectly competitive market
D) profit is at best zero because cost must be at least greater than zero
E) they should advertise

Question

Quizplus · Accepted Answer

In a perfectly competitive market, firms have insignificant market shares, indicating that no single firm can influence market prices or conditions significantly. This scenario describes a characteristic of perfect competition.

If All the Firms Producing a Good in an Industry