Which of the following is true concerning purely competitive industries?

A) There will be economic losses in the long run because of cut-throat competition.
B) Economic profits will persist in the long run if consumer demand is strong and stable.
C) In the short run, firms may incur economic losses or earn economic profits, but in the long run they earn normal profits.
D) There are economic profits in the long run but not in the short run.

Purely Competitive Industries

Industries in which many firms sell identical products to many buyers and no single seller can influence the market price.

Economic Losses

The difference when total costs, including both explicit and implicit costs, exceed total revenues, indicating that resources could be better employed elsewhere.

Economic Profits

The difference between total revenue and total costs, including both explicit and implicit costs, representing excess returns over the firm's opportunity costs.