Exhibit 10-7
-In the long run, the firm in Exhibit 10-7 can expect

Question

Exhibit 10-7 
-In the long run, the firm in Exhibit 10-7 can expect

Quizplus · Accepted Answer

In the long run, the firm in the exhibit will adjust its output such that its economic profit is equal to zero. This occurs where marginal revenue equals marginal cost at the intersection of the demand and the ATC curves. At this output level, total revenue will equal total cost, resulting in zero economic profit. Therefore, the firm can expect to earn zero economic profit in the long run.

Exhibit 10-7 -In the Long Run, the Firm in Exhibit 10-7 Can