Final answer:
Entry and exit in a market can lead to zero profits in the long run due to competitive dynamics.
Step-by-step explanation:
Entry and exit in a market can lead to zero profits in the long run due to the process of competitive dynamics. When new firms enter a market, they increase competition and drive down prices, resulting in lower profits for existing firms. Conversely, when firms exit a market, it reduces competition and allows the remaining firms to increase prices, potentially leading to higher profits. This adjustment process continues until the market reaches a point where firms earn zero economic profits, with revenues equaling total costs.