The theory of monopolistic competition predicts that,in long-run equilibrium,a monopolistically competitive firm will

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In long-run equilibrium, a monopolistically competitive firm will produce the output level at which price equals long-run average cost. This is because in the long run, firms have the ability to adjust their production processes and enter or exit the market, which leads to the elimination of economic profits. Therefore, a monopolistically competitive firm will produce where its price equals its long-run average cost, which results in zero economic profits.

The Theory of Monopolistic Competition Predicts That,in Long-Run Equilibrium,a Monopolistically