Why would a firm that incurs losses choose to produce

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1. Why would a firm that incurs losses choose to produce rather than shut down?

2. In long-run equilibrium, all firms in the industry earn zero economic profit. Why is this true?

3. Because industry X is characterized by perfect competition, every firm is earning zero economic profit. If the product price falls, no firm can survive. Do you agree or disagree.

Reference no: EM132414855

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