As the equilibrium price falls in a perfectly competitive market, so do firms':

Question

Emily Hensley

Business

13 January, 07:35

As the equilibrium price falls in a perfectly competitive market, so do firms':

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America Griffith · Answer 1

Firm's revenue and their profits falls as the equilibrium price falls in a perfectly competitive market.

The falling of equilibrium price is directly proportional to the decrease in supply and demand, thus, revenue and profits of businesses in a competitive market will surely be affected.