Which of the following is not characteristic of long-run equilibrium under monopolistic competition?

Question

Quizplus · Accepted Answer

In long-run equilibrium under monopolistic competition, firms face a downward-sloping demand curve, and they have excess capacity. This means that price equals average total cost (ATC) to ensure normal profit, not minimum average total cost. Choices B, C, and D are characteristics of monopolistic competition in the long run.

Which of the Following Is Not Characteristic of Long-Run Equilibrium