perfect competition 5 long run adjustments

uses diagrams to show the long run adjustment in a pure or perfect competition diagram

Category:

Education

Tags:

• perfect
• competition
• long
• run
• equilibrium

[cinqueottavi]

Well may be some one can explain me.Why on the long run nobody will exit the market? I understand in long run there is no profit.So no one want to enter...but I would exit if there is no profit.

[econsteve12]

@cinqueottavi

Hi, the reason is that zero economic profits, does mean that the income is covering OPPORTUNITY COSTS' - this is the way economists look at costs. So, the person who owns the business, say, is earning an income at least as great as any other alternative they might be employed in. Thus zero ECONOMIC profit, means the company stays around. Make sense?

[nolla454]

you are my real teacher on Microeconomics... thank you soo muchhh

[fackhead]

thank you based god

[cinqueottavi]

@econsteve12 Thanks ecosteve for your quick answer.If I well undestand then, ECONOMIC Profit=0 means a company reached the Break Even.Thus no profit is generated but also no Loss.So since generally company are there to make profit,at least,if I where the owner of such a company I would not be happy to just cover my cost without generating money.(So personally I would start thinking going out).Again Thanks for you explanation and video.They are great and I'm sure you helped a lot of students.

[Wrckless]

Thank you! Thank you! Thank you! I have my final tomorrow and I was worried, because they tables never made much sense reading them in the book. I don't know why I didn't come out here sooner. I appreciate all your blackboards!

[kevincmccollow]

well articulated concepts. but get some new software. jesus christ

[leocharnel]

I have a preoccupation. When the firm are entered into the market, Is the production into the market decrease? The price is law, which will want to continue to produce the same amount, if this will decrease their revenu and then will decrease their profit. In another way the variable cost will decrease, which will make the total cost shift down, and then the tendance in the market will still be the same. Also in which way demand can influence the market?

[coldbloodisback]

Thanks sir:)

[tmacgirl3]

ommmggg everything just clicked finnallyy!

you're the best honestly, thank you SO MUCH