Long-run economic profits would most likely exist in which market structure?
A)Monopoly, monopolistic competition and oligopoly
B)Monopoly and oligopoly
C)Monopoly and monopolistic competition
D)Monopoly only

Question

Quizplus · Accepted Answer

In a monopoly, the single firm has the ability to control prices and restrict output, leading to economic profits in the long run. In an oligopoly, a few dominant firms also have some degree of market power, allowing for the potential of long-run economic profits. However, in monopolistic competition, firms typically have little market power and face competition from many other firms producing similar products, leading to zero economic profits in the long run.

Long-Run Economic Profits Would Most Likely Exist in Which Market