A lesson from microeconomics is that unless there is some market power where firms charge prices above marginal cost,__________ are zero.
A)costs
B)revenues
C)normal profits
D)economic profits
E)variable costs

Question

Quizplus · Accepted Answer

In perfect competition, firms operate at a zero economic profit, as the price is equal to the marginal cost. Therefore, option D, economic profits, will be zero.

A Lesson from Microeconomics Is That Unless There Is Some