Classify the statements based on whether each describes a perfectly (purely) competitive firm earning an economic profit, a firm at zero economic profits, or a firm operating at a loss.Economic ProfitZero Economic ProfitEconomic Loss Firms incentivized to leave the marketFirms incentivized to enter the marketP<ATCP>ATCAt long-run equilibriumP=ATC

When Price is higher (lower) then ATC, firms make economic profit (loss) and enter (leave) the…

Answered: economic profit, a firm at zero…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Classify the statements based on whether each describes a perfectly (purely) competitive firm earning an economic profit, a firm at zero economic profits, or a firm operating at a loss.

Economic Profit	Zero Economic Profit	Economic Loss

Firms incentivized to leave the market
Firms incentivized to enter the market
P<ATC
P>ATC
At long-run equilibrium
P=ATC

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