Which of the Following Is TRUE of Firms in Both

question 45

Multiple Choice

Which of the following is TRUE of firms in both perfect competition and monopolistic competition?

• A) The long-run price is equal to marginal revenue, marginal cost, and average total cost.
• B) Long-run economic profits are equal to zero.
• C) The long-run level of output is at the point where average total cost is minimized.
• D) Price is equal to marginal cost, ensuring that the efficient level of output is produced.

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Definitions:

RRSP

A Registered Retirement Savings Plan, which is a retirement savings and investing vehicle for employees and the self-employed in Canada, offering tax benefits.

Maturity Value

The amount of money an investment will grow to over a period of time at a specified interest rate.

Interest Rate

The percentage of a loan that is added on as interest for the borrower, usually stated as an annual rate.

Economic Value

A measure of the benefit provided by a good or service to an economic agent.