Which of the Following Is True Regarding the Long Run

question 252

Multiple Choice

Which of the following is true regarding the long run for a firm in monopolistic competition?

• A) P = MC = ATC
• B) P = MC = MR
• C) ATC = MC = MR
• D) P = ATC

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Definitions:

Compounded Monthly

Compounded monthly refers to the process where the interest earned on an investment is added to the principal sum each month, causing the principal amount to grow at an increasing rate.

Effective Rate

The actual interest rate an individual pays or earns on a loan or investment, taking into account the effects of compounding.

Compounded Semiannually

Refers to the process of calculating and adding interest to the principal balance of an investment or loan twice a year.

Strip Bond

A fixed-income security derived from the separation of the coupons from the principal of a bond, which are then sold separately as zero-coupon bonds.