In the long run, a monopolistically competitive firm's demand curve must be tangent to its average cost curve.

Name: In the long run, a monopolistically competitive firm's demand curve must be tangent to its average cost curve.
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In the long run, monopolistically competitive firms will produce at the point where price equals average total cost to maximize profit. This is where their demand curve is tangent to the average cost curve.

In the Long Run, a Monopolistically Competitive Firm's Demand Curve