Answer to Question #152229 in Microeconomics for melissa

Question

Normally, firms behave differently in a perfect competition market structure, explain what changes occur from the short run to the long run 

Answer 1

In the short-run, when plant and equipment are fixed, the firms in a perfect competition market may earn profits or suffer losses.

In the long-run, when plant and equipment are adjustable, profits will attract new entrants, while losses will cause existing firms to leave the industry.