Final answer:
Firms in perfectly competitive industries can expect to earn only competitive parity since any economic profits would attract new entrants, increasing supply and driving profits down. In contrast, oligopolistic markets, with only a few dominant firms, can experience elements of both monopoly and perfect competition, impacting profits based on the degree of cooperation or competition.
Step-by-step explanation:
Firms in a perfectly competitive industry can expect to earn only competitive parity, meaning that they would earn normal profits but not economic profits in the long run. This is due to the fact that in a perfect competition, there are many firms selling identical products. If firms are earning above-normal profits, new firms will enter the market, increase the supply, and thus push prices down until profits reach normal levels. On the contrary, if firms are suffering losses, some will exit the market, decreasing the supply and raising prices until losses are eliminated.
In monopolistic competition, firms sell similar but differentiated products and can have some control over the price. They can earn economic profits in the short run, but in the long term, the entry of new competitors will drive profits down to zero. Meanwhile, oligopolies, characterized by a few large firms and mutual interdependence, may engage in behavior ranging from fierce competition to cooperation or collusion. Firms in an oligopoly could earn profits akin to that of a single firm monopoly if they collaborate, but could also end up acting like perfect competitors if they compete aggressively.