Which of the following is false?
A) Long run equilibrium in monopolistic competition results in zero economic profits.
B) Monopolistic competitor's demand curves are likely to be more elastic than those of monopolists.
C) Monopolistic competition results in a greater variety of products than perfect competition.
D) Monopolistic competition's zero economic profit long run equilibrium is efficient, like the zero profit equilibrium in perfect competition.

Question

Quizplus · Accepted Answer

The zero economic profit long run equilibrium in monopolistic competition is not efficient, unlike the zero profit equilibrium in perfect competition. Monopolistic competition involves product differentiation and excess capacity, which can lead to inefficiencies in production and allocation of resources.

Which of the Following Is False