Economics · Microeconomics

In a perfectly competitive market, long-run equilibrium is characterized by which of the following?

Verified Solution4 OptionsUpdated: October 2026👁️1 View

1There is deadweight loss in the market as firms restrict output to increase profits.
2Firms earn normal profits, and both allocative and productive efficiencies are achieved.✓
3Firms operate at the minimum of their short-run average cost curve, but not necessarily at the minimum of their long-run average cost curve.
4Firms produce at a level where marginal cost is greater than marginal revenue, ensuring allocative efficiency.

Correct answer

Firms earn normal profits, and both allocative and productive efficiencies are achieved.

Save this question and verified answer as a clean study sheet with live clickable link.

👥

Challenge your peer aspirants on WhatsApp or Telegram to solve this question!

Online Test Series

Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.

Chapter Practice

Want more practice questions on Microeconomics?

Solve complete topic-wise tests with detailed solutions on GkGet.

Recommended practice questions in Economics · Microeconomics

The arrival of which commission in India triggered widespread protests, including mass hartals across the country in 1928?

Which of the following leaders was instrumental in initiating and leading India’s struggle for independence?

Which of the following viceroys of India is associated with the 'Ilbert Bill' controversy?

Related Practice Questions