Which of the following is generally true of a monopolistically competitive firm operating in the long run?

Question

Quizplus · Accepted Answer

In the long run, a monopolistically competitive firm will produce at a point where price equals average total cost but not marginal cost, resulting in a markup over marginal cost. This means that price will be greater than the minimum average total cost. Economic profits may or may not be positive, depending on the specific circumstances of the market. Marginal revenue will be less than price, and average revenue will be less than price due to the downward sloping demand curve. Therefore, choice A is the best answer.

Which of the Following Is Generally True of a Monopolistically