Tags
#cfa #cfa-level-1 #economic-and-normal-profit #economics #microeconomics #reading-15-demand-and-supply-analysis-the-firm #section-2-objectives-of-the-firm #study-session-4
Question
In highly competitive market situations, firms tend to earn the normal profit level over time because [...] any economic profit over the long run.
Answer
ease of market entry allows for other competing firms to compete away