If a market is in long-run equilibrium, which of the following conditions will be present in a competitive price-taker market but absent from a competitive price-searcher market?
A) P = ATC
B) MR = MC
C) P = MC
D) MR

Question

If a market is in long-run equilibrium, which of the following conditions will be present in a competitive price-taker market but absent from a competitive price-searcher market?
A) P = ATC
B) MR = MC
C) P = MC
D) MR < P

Quizplus · Accepted Answer

In a competitive price-taker market, firms are price takers and will produce where price equals marginal cost (P = MC) in long-run equilibrium. In contrast, a competitive price-searcher market, such as monopolistic competition, will not have P = MC because firms have some control over their prices.

If a Market Is in Long-Run Equilibrium, Which of the Following