Asked by
Abdul Iddrisu
on Nov 27, 2024
Verified
Which of the following distinguishes the short run from the long run in pure competition?
A) Firms can enter and exit the market in the long run but not in the short run.
B) Firms attempt to maximize profits in the long run but not in the short run.
C) Firms use the MR = MC rule to maximize profits in the short run but not in the long run.
D) The quantity of labor hired can vary in the long run but not in the short run.
Pure Competition
A market structure characterized by a large number of small firms, a homogeneous product, and easy entry and exit from the market.
Long Run
A period in which all factors of production and costs are variable, enabling full adjustment to change.
Short Run
A period in which at least one input in the production process is fixed, and only some inputs can be adjusted by firms.
- Understand the distinctions between short-term and long-term supply curves within entirely competitive markets.
Verified Answer
BM
Learning Objectives
- Understand the distinctions between short-term and long-term supply curves within entirely competitive markets.