General Snacks is a typical firm in monopolistic competition.If the market is in long-run equilibrium,then the price General Snacks charges for its snack goods:
A)equals average total cost.
B)exceeds average total cost.
C)is less than average total cost.
D)is more than the average for all other firms in the market.

Question

Quizplus · Accepted Answer

In long-run equilibrium under monopolistic competition, firms produce at a point where price equals average total cost, ensuring they earn normal profit but not economic profit.

General Snacks Is a Typical Firm in Monopolistic Competition