Under perfect competition in the short run

A) most firms make zero economic profits.
B) firms can enter or leave the industry.
C) all firms are making a profit.
D) all firms are losing money.
E) None of these conditions prevail.

Perfect Competition

A market structure characterized by many buyers and sellers, homogeneous products, free entry and exit, and perfect information, where no single entity can influence market prices.

Economic Profits

The surplus obtained when a firm’s total revenues exceed both its explicit and implicit costs, providing a full picture of its financial health.

Short Run

A period in economics during which some factors of production are fixed, limiting the ability of a business to adjust to market changes.