Which of the following is uncharacteristic of monopolistic competition in the long run?

Question

Quizplus · Accepted Answer

In the long run, firms in monopolistic competition will experience zero economic profits due to the ease of entry and exit of firms in the industry. As a result, firms in monopolistic competition will not be able to charge a price in excess of marginal revenue. They will also have excess capacity, meaning they are not producing at full efficiency. However, they will still sell differentiated products, but equilibrium will be reached on the downward sloping portion of the average total cost curve, not the increasing portion.

Which of the Following Is Uncharacteristic of Monopolistic Competition in the Long