Figure 13-2

-In Figure 13-2, which of the graphs represents a monopolistic competitor in long-run equilibrium?

Question

Figure 13-2
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-In Figure 13-2, which of the graphs represents a monopolistic competitor in long-run equilibrium?

Quizplus · Accepted Answer

Graph 3 represents a monopolistic competitor in long-run equilibrium because it shows the firm making zero economic profit, as the average total cost curve (ATC) touches the demand curve at the point where the demand curve is tangent to the ATC curve, which is characteristic of long-run equilibrium in monopolistic competition.

Figure 13-2 ​

Figure 13-2