Which of the following is true of firms in both perfect competition and monopolistic competition?
A)The long-run price is equal to marginal revenue, marginal cost, and average total cost.
B)Long-run economic profits are equal to zero.
C)The long-run level of output is at the point where average total cost is minimized.
D)Price is equal to marginal cost, ensuring that the efficient level of output is produced.

Question

Quizplus · Accepted Answer

Both perfect competition and monopolistic competition have zero long-run economic profits. However, the other options are not necessarily true for both types of market structures.

Which of the Following Is True of Firms in Both