Which of the following is true for both perfect competition and monopoly?
A)Firms produce a differentiated product.
B)Firms cannot earn economic profit in the long run.
C)Individual firms have no ability to control the price of their output but must accept the market price.
D)Firms go out of business in the long run if total revenue cannot cover total cost.
E)Firms usually earn economic profit in the long run.

Question

Which of the following is true for both perfect competition and monopoly?​
A)Firms produce a differentiated product.
B)Firms cannot earn economic profit in the long run.
C)Individual firms have no ability to control the price of their output but must accept the market price.
D)Firms go out of business in the long run if total revenue cannot cover total cost.
E)Firms usually earn economic profit in the long run.

Quizplus · Accepted Answer

In both perfect competition and monopoly, firms will go out of business in the long run if total revenue cannot cover total cost.

Which of the Following Is True for Both Perfect Competition