In the long-run equilibrium of a market with free entry and exit, if all firms have the same cost structure, then
a. marginal cost exceeds average total cost.
b. the price of the good exceeds average total cost.
c. average total cost exceeds the price of the good.
d. firms are operating at their efficient scale.
d
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Indicate whether the statement is true or false
A regression model exhibits unobserved heterogeneity if _____.
A. there are unobserved factors affecting the dependent variable that change over time B. there are unobserved factors affecting the dependent variable that do not change over time C. there are unobserved factors which are correlated with the observed independent variables D. there are no unobserved factors affecting the dependent variable