Use the figure below to answer the following questions.

Figure 12.4.1
-Refer to Figure 12.4.1, which shows the cost curves and marginal revenue curve of a firm in a perfectly competitive market. In the long run,

Question

Use the figure below to answer the following questions.
  
Figure 12.4.1
-Refer to Figure 12.4.1, which shows the cost curves and marginal revenue curve of a firm in a perfectly competitive market. In the long run,

Quizplus · Accepted Answer

In the long run, firms in a perfectly competitive market will expand production to the point where marginal cost equals marginal revenue. This is because firms can enter or exit the market freely, so in the long run, only firms that are making a profit will remain in the market.

Use the Figure Below to Answer the Following Questions