The price-quantity combination that will prevail in a perfectly competitive market in the long run is called
A) short-run equilibrium
B) Nash equilibrium
C) long-run equilibrium

Question

Quizplus · Accepted Answer

In the long run, all firms have the opportunity to enter or exit the market, and the price adjusts until it equals the minimum average total cost of production. This results in the long-run equilibrium price and quantity, which maximize social welfare and consumer surplus. Therefore, the correct answer is C) long-run equilibrium.

The Price-Quantity Combination That Will Prevail in a Perfectly Competitive