The long-run equilibrium for a firm in an information product industry exists at a point at which

Question

Quizplus · Accepted Answer

In the long-run equilibrium, the firm will produce at the minimum point of its average total cost curve. At this point, the demand curve will be tangent to the average total cost curve, indicating that the firm is producing at the most efficient scale of production. Therefore, choice C is the correct answer. Choices A, B, and D may be relevant in determining short-term profits or losses, but they do not indicate long-run equilibrium.

The Long-Run Equilibrium for a Firm in an Information Product