Long-run equilibrium market price


Problem: Which of the given would occur if a single farm in a perfect competition lowered its price below the long-run equilibrium market price?

A) all other farms would lower prices too

B) it would not be maximizing profit

C) It would get a larger share of the market, and this would be profitable for it.

D) Other farms would be driven out of the industry.

E) other farms would enter the industry.

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Microeconomics: Long-run equilibrium market price
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