marginal firm operates at a point where the price of the products is equal to AC of production .This firm earns zero profits, why does it still stay in business????
THZ A LOT
marginal firms
2007-09-02 2:26 am
回答 (2)
2007-09-03 10:21 pm
✔ 最佳答案
To answer this question, we need to know the difference between "Accounting Profit" and "Economic Profit".
Accounting Profit = Accounting Income - Accounting Cost
Economic Profit = Accounting Income - Accounting Cost - Implicit Cost(or Opportunity Cost).
The firm in our question earns zero "Economic Profit" after considering opportunity cost. However, it still earns positive "Accounting Profit". Therefore it still stays in business.
2007-09-02 6:47 am
既然導致infra-marginal firm earn rent的原因是有superior factors,那為何marginal firms不去爭取他? 最終導致superior factors的market price上升,infra-marginal firm的成本上升,直至不再有superior factors能帶來rent為止 ...
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