In this article we will discuss about the equilibrium of the perfectly competitive industry. Conditions of Equilibrium of the Perfectly Competitive Industry: An industry is in equilibrium: (i) When there is no tendency for the firms either to leave or enter the industry, and (ii) When each firm is also in equilibrium. The first condition implies that the average cost [...]
In this article we will discuss about the short run and long run equilibrium of the firm. Short-Run Equilibrium of the Firm: The short run is a period of time in which the firm can vary its output by changing the variable factors of production in order to earn maximum profits or to incur minimum losses. The number of firms [...]
In this article we will discuss about the price determination in a perfectly competitive market. A perfectly competitive market is one in which the number of buyers and sellers is very large, all engaged in buying and selling a homogeneous product without any artificial restrictions and possessing perfect knowledge of market at a time. There are two parties which bargain [...]