When firms exit a perfectly competitive industry, the market supply curve shifts to the left.8/20/2023 When firms enter the market, prices fall and economic profit goes to zero. That means, when firms are earning economic profits, competing firms seek that profit and enter the market in the long run. In perfectly competitive markets, barriers to entry are low. Barriers to entry can be high start up costs, customer loyalty, government regulation, etc. Barriers to entry: A barrier to entry is anything that makes it difficult for entrepreneurs to enter the market and compete.
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