When a Monopolistically Competitive Firm Is in Long-Run Equilibrium

question 85

Multiple Choice

When a monopolistically competitive firm is in long-run equilibrium,

• A) production takes place where ATC is minimized.
• B) marginal revenue equals marginal cost and price equals average total cost.
• C) normal profit is zero and price equals marginal cost.
• D) economic profit is zero and price equals marginal cost.

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Definitions:

Production Blocking

A phenomenon in group brainstorming where the flow of ideas is inhibited because only one participant can speak at a time.

Social Loafing

The phenomenon where individuals exert less effort on a task when working in a group compared to when working alone.

Production Matching

A cognitive process where individuals match new information with what they have previously learned or experienced.

Distraction

The process of diverting someone's attention from the intended object of focus to something else.