5. A profit-maximizing firm in a competitive market will earn zero accounting profits in the long...

5. A profit-maximizing firm in a competitive market will earn zero accounting profits in the long run. a. True b. False

6.In the long run, when price is greater than average total cost, some firms in a competitive market will choose to enter the market. a. True b. False

7. In making a short-run profit-maximizing production decision, the firm must consider both fixed and variable cost. a. True b. False

8. A firm operating in a perfectly competitive market may earn positive, negative, or zero economic profit in the long run. a. True b. False

9. A firm operating in a perfectly competitive market earns zero economic profit in the long run but remains in business because the firm’s revenues cover the business owners’ opportunity costs. a. True b. False

10. In the long run, a competitive market with 1,000 identical firms will experience an equilibrium price equal to the minimum of each firm's average total cost. a. True b. False

11. For firms operating in a perfectly competitive market, price must always be greater than marginal revenue. a. True b. False

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Expert Solution

Rahul Sunny answered 9 months ago

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