Suppose That a Monopolistically Competitive Market Is at the Long-Run

question 11

Multiple Choice

Suppose that a monopolistically competitive market is at the long-run equilibrium.Based on this information,which of the following conclusions is NOT true?

• A) P > MC.
• B) Deadweight loss is zero.
• C) P = ATC > minimum of ATC.
• D) Firms' profits are zero.

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Definitions:

Price Discrimination

The strategy of selling the same product at different prices to different groups of buyers.

Oligopoly

A market structure characterized by a small number of firms that hold a significant market share, leading to limited competition.

Price Discrimination

A pricing strategy where a business charges different prices to different customers for the same product or service, based on what the seller believes the customer is willing to pay.

Producer

An individual or organization that creates goods or services to sell to consumers.