In Monopolistically Competitive Markets in Long Run Equilibrium

question 129

Multiple Choice

In monopolistically competitive markets in long run equilibrium:

• A) more than the efficient level of output will be produced because price exceeds marginal cost.
• B) less than the efficient level of output will be produced because price exceeds marginal cost.
• C) more than the efficient level of output will be produced because marginal revenue exceeds marginal cost.
• D) less than the efficient level of output will be produced because marginal revenue exceeds marginal cost.

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Definitions:

Withdraw

The action of removing funds from an account or investment.

Compound Rate

The rate at which interest is calculated on the initial principal and also on the accumulated interest of previous periods.

Annually

Occurring once every year or relating to a period of one complete year.

Interest

The cost of borrowing money, represented as a percentage of the total amount loaned.