Long-run equilibrium for firms in monopolistically competitive industries is similar to that for firms in perfect competition in that

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In both monopolistically competitive and perfectly competitive industries, firms in the long-run equilibrium will produce where price equals average total cost. This is because in the long run, the presence of free entry and exit in perfect competition or low barriers to entry and exit in monopolistic competition will allow firms to earn only normal profit. Therefore, in order to cover all their costs, firms must charge a price that equals the average total cost of production.

Long-Run Equilibrium for Firms in Monopolistically Competitive Industries Is Similar