In the long run,a profit-maximizing firm in a monopolistically competitive market operates at which of the following

Question

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A profit-maximizing firm in a monopolistically competitive market operates at a level of output where marginal revenue equals marginal cost. However, in the long run, firms in a monopolistically competitive market face zero economic profits, which means that price equals average total cost. Therefore, the firm will operate at a level of output where average total cost is falling, as this is where the firm can produce efficiently while charging a price that covers all costs. Choices A and B are not necessarily true, as marginal revenue and marginal cost can both fluctuate, and the firm's aim is to maximize profits, not necessarily minimize costs. Choice D is not true, as the firm would not continue to produce at a level where average total cost is rising, as this would result in losses.

In the Long Run,a Profit-Maximizing Firm in a Monopolistically Competitive