For a perfectly competitive firm at its long-run competitive equilibrium point

Name: For a perfectly competitive firm at its long-run competitive equilibrium point
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Question

Quizplus · Accepted Answer

At the long-run competitive equilibrium point, the firm will produce where P = MC and P = minimum average total cost (LATC). Since the firm is perfectly competitive, it faces a horizontal demand curve, meaning P = AR = MR. Therefore, at the long-run competitive equilibrium point, P = AR = MR = LATC = ATC = MC.

For a Perfectly Competitive Firm at Its Long-Run Competitive Equilibrium