Market structure refers to the characteristics of an industry that define the likely behaviour and performance of its firms. One of market structure is pure competition. According to the basic model of pure competition, in the long run all firms in a purely competitive industry will earn normal profits. If all firms earn only a normal profit in the long run, critically evaluate why any firms would bother to develop new products or lower-cost production methods

Market structure refers to the characteristics of an industry that define the likely behaviour and performance of its firms. One of market structure is pure competition. According to the basic model of pure competition, in the long run all firms in a purely competitive industry will earn normal profits. If all firms earn only a normal profit in the long run, critically evaluate why any firms would bother to develop new products or lower-cost production methods

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter26: Monopolistic Competition And Oligopoly

Section: Chapter Questions

Problem 8E

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