Entry continues as long as

Name: Entry continues as long as
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Entry into a market continues as long as economic profits are positive. This is because economic profits take into account both explicit costs (like accounting profits do) and implicit costs, including the opportunity cost of capital. Positive economic profits indicate that the firm is covering all its costs, including the opportunity cost of resources, and is an incentive for new firms to enter the market.

Entry Continues as Long as