In the Long Run

question 183

Multiple Choice

In the long run

• A) firms in both monopolistic competition and perfect competition achieve allocative efficiency but not productive efficiency.
• B) only firms in a perfect competition achieve both allocative and productive efficiencies.
• C) only firms in monopolistic competition achieve both allocative and productive efficiencies.
• D) neither firms in perfect competition nor monopolistic competition achieve allocative efficiency.

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Definitions:

Production Possibilities Curves

A graphical representation that shows the maximum number of goods or services that can be produced with limited resources.

Constant Costs

Costs that do not change with the level of output production, remaining stable over a certain range of production.

Increasing Costs

A scenario where the costs of producing goods or services trend upwards over time, affecting profitability and pricing strategies.

World Price

The international market price of a good or service, determined by world demand and supply.