Which of the following outcomes is consistent with a purely competitive market in long-run equilibrium?
A) Combined consumer and producer surplus will be maximized.
B) P = MC = lowest AVC.
C) The minimum willingness to pay equals the maximum acceptable price.
D) We would expect all of these to occur in the long run in a purely competitive market.

Question

Quizplus · Accepted Answer

In a purely competitive market in long-run equilibrium, the price equals marginal cost (P = MC), and firms produce at the lowest point on their average total cost curve, maximizing combined consumer and producer surplus.

Which of the Following Outcomes Is Consistent with a Purely