Figure 9.13 9.3 Perfect Competition in the Long Run LEARNING OBJECTIVES Distinguish between economic profit and accounting profit Explain why in long-run equilibrium in a perfectly competitive industry firms will earn zero economic profit 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 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 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: http://www.saylor.org/books/ Saylor.org 496