Which of the Following Is True for a Monopolistically Competitive

question 260

Multiple Choice

Which of the following is true for a monopolistically competitive firm in long-run equilibrium?

• A)P = ATC and MR = MC.
• B)P = ATC and P = MC.
• C)P > ATC and P > MR.
• D)P > MR and MC = ATC.

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Definitions:

Budget Constraint

A budget constraint represents the limitations on the spending choices of consumers based on their income and the prices of goods and services.

DVDs

Digital Versatile Discs, a type of optical storage media used for storing data, including movies, software, and other digital information.

CDs

Compact Discs, a form of digital optical disc data storage, used for storing digital data, including music, software, and data files.

Budget Constraint

The limitation on the purchase of goods and services based on the availability of income and wealth, reflecting the trade-off between different combinations of goods.