In competitive market structure, firms earn zero economic profit in the long run but still remain in the market. Firms facing loss in short run may continue to produce in a competitive market structure. Price discrimination is beneficial for the society in general but it is difficult to practice in real world. Monopolistically competitive firms are producing efficiently because P=MC in the long-run. 5. Advertising helps raise revenue for the firms and provides information to the customers; therefore, expenditures on advertising are justified.

In competitive market structure, firms earn zero economic profit in the long run but still remain in the market. Firms facing loss in short run may continue to produce in a competitive market...

In competitive market structure, firms earn zero economic profit in the long run but still remain in the market.

Firms facing loss in short run may continue to produce in a competitive market structure.

Price discrimination is beneficial for the society in general but it is difficult to practice in real world.

Monopolistically competitive firms are producing efficiently because P=MC in the long-run.

5. Advertising helps raise revenue for the firms and provides information to the customers; therefore, expenditures on advertising are justified.

Jun 09, 2022