Authors libby rittenberg 496

Figure 9.13

9.3 Perfect Competition in the Long
Run
LEARNING OBJECTIVES
1. Distinguish between economic profit and accounting profit.
2. Explain why in long-run equilibrium in a perfectly competitive industry
firms will earn zero economic profit.
3. Describe the three possible effects on the costs of the factors of
production that expansion or contraction of a perfectly competitive
industry may have and illustrate the resulting long-run industry supply
curve in each case.
4. Explain why under perfection competition output prices will change
by less than the change in production cost in the short run, but by the
full amount of the change in production cost in the long run.
5. Explain the effect of a change in fixed cost on price and output in the
short run and in the long run under perfect competition.

Attributed to Libby Rittenberg and Timothy Tregarthen
Saylor URL: />
Saylor.org

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