Which of the following is true about the long run operations of perfectly competitive firms?

Question

Quizplus · Accepted Answer

Perfectly competitive firms operate in a market structure where there are many firms selling homogenous products, there are no barriers to entry or exit, and there is perfect information. In the long run, these firms will produce with productive efficiency, meaning they are producing at the minimum average total cost. They also produce with allocative efficiency, where they are producing at the point where price equals marginal cost. Because of these efficiencies, firms in a perfectly competitive market will earn zero economic profit in the long run. Therefore, all of the above options are true.

Which of the Following Is True About the Long Run