Why can a firm not earn abnormal profits under perfect competition in

1.	Why can a firm not earn abnormal profits under perfect competition in the long run? Explain.
Answer» <html><body><p></p><a href="https://interviewquestions.tuteehub.com/tag/solution-25781" style="font-weight:bold;" target="_blank" title="Click to know more about SOLUTION">SOLUTION</a> :It is because the no. of sellers is so large that the share of each seller is insignificant in the total supply. Hence, an individual seller cannot <a href="https://interviewquestions.tuteehub.com/tag/influence-1043703" style="font-weight:bold;" target="_blank" title="Click to know more about INFLUENCE">INFLUENCE</a> the market price. Similarly, a single buyer's share in total purchase is so insignificant because of their large no. that an individual buyer cannot influence the market price. Under such conditions, price of a commodity is determined by the market <a href="https://interviewquestions.tuteehub.com/tag/forces-16875" style="font-weight:bold;" target="_blank" title="Click to know more about FORCES">FORCES</a> of demand and supply and each buyer and seller has to accept the same price. As a <a href="https://interviewquestions.tuteehub.com/tag/result-1187343" style="font-weight:bold;" target="_blank" title="Click to know more about RESULT">RESULT</a>, uniform price prevails in the market.</body></html>

Why can a firm not earn abnormal profits under perfect competition in the long run? Explain.