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Figure: Profit Maximization in Monopolistic Competition
-(Figure: Profit Maximization in Monopolistic Competition) Look at the figure Profit Maximization in Monopolistic Competition. In monopolistic competition, long-run equilibrium is characterized by:

Question

Use the following to answer questions:
Figure: Profit Maximization in Monopolistic Competition 
-(Figure: Profit Maximization in Monopolistic Competition) Look at the figure Profit Maximization in Monopolistic Competition. In monopolistic competition, long-run equilibrium is characterized by:
A) P > MR. 
B) P < MR. 
C) P = MR. 
D) profit maximization, which occurs where P = MR = MC.

Quizplus · Accepted Answer

In monopolistic competition, firms face a downward-sloping demand curve, so price (P) is greater than marginal revenue (MR) in the long run.

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