In the long run,an entrepreneur who owns a perfectly competitive firm will earn an income just equal to what she could earn in the next best alternative use of her time.

Question

Quizplus · Accepted Answer

In a perfect competition, firms have little to no control over prices and must sell their products at the market price. This means that the profit margins are very low, and in the long run, entrepreneurs will only earn enough to cover their opportunity cost, which is the income that could have been earned in other alternative uses of their time. Therefore, the statement is true.

In the Long Run,an Entrepreneur Who Owns a Perfectly Competitive