When a monopolistically competitive industry is in long-run equilibrium: choose correct and explain your choice a. firms earn economic profits. b. firms earn zero economic profits. c. price equals minimum average total cost. d. price equals marginal cost.

When a monopolistically competitive industry is in long-run equilibrium: choose correct and explain your choice a. firms earn economic profits. b. firms earn zero economic profits. c. price equals minimum average total cost. d. price equals marginal cost.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter14: Monopolistic Competition And Product Differentiation

Section: Chapter Questions

Problem 6P

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Question

When a monopolistically competitive industry is in long-run equilibrium: choose correct and explain your choice

a. firms earn economic profits.

b. firms earn zero economic profits.

c. price equals minimum average total cost.

d. price equals marginal cost.

Definition Definition Total cost of producing a certain quantity of a good, divided by the quantity produced. It is the sum of all costs (fixed and variable) required to produce one unit of output.

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