a
new firms can not enter the market due to copyright laws.
b
more firms can enter the industry due to attractive prof its.
c
marginal revenue is greater than marginal cost at all levels.
d
profits are not enough to repay traders' loans.
Explanation
Correct Option
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StephEd007
7 months ago
The answer is B. In perfect competition, there are many firms, no barriers to entry or exit, and identical products.
So if firms are making supernormal (extra) profit in the short run, what happens?
New firms see the profit and enter the market.
As they enter, supply increases, which causes the price to fall.
Eventually, price falls until firms only make normal profit (meaning they just cover all costs — no loss, no gain)
