Which of the following holds true at the chosen level of output in the long run for firms in a perfectly competitive market?

Question

Quizplus · Accepted Answer

In a perfectly competitive market, firms produce at the point where P = MC, as this is the profit-maximizing output level in the long run. This also ensures that firms are producing at minimum average total cost (ATC), as P = minimum ATC in the long run due to competition driving prices down to this level. Additionally, at the profit-maximizing output level, MR = MC holds true. Therefore, all of the given statements are true in the long run for firms in a perfectly competitive market.

Which of the Following Holds True at the Chosen Level