Firms in Perfect Competition Are Unlikely to Earn Economic Profits

Multiple Choice

Firms in perfect competition are unlikely to earn economic profits in the long run because:

A) all resources are variable in the long run, creating uncertainty for the firm.
B) the existence of economic profits will attract new firms into the industry and reduce the price.
C) in the long run, diseconomies of scale result in increased costs.
D) in the long run, the demand curve for the firm will not remain horizontal.