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If We Observe Firms Earning Zero Economic Profits in the Short

Question 206

Multiple Choice

If we observe firms earning zero economic profits in the short run, we know that


A) the industry must be perfectly competitive.
B) the industry must be either perfectly competitive or monopolistically competitive.
C) there must not be any barriers to entry.
D) any market structure is possible since firms under any market structure can earn zero profits at some time.

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