Question:
Which of the following is true under monopolistic competition in the long run?
a. P = MC
b. P = MR
c. Profits are always zero.
d. All of the choices are true in monopolistic competition.
Monopolistic Competition:
Monopolistically competitive markets are characterized by a large number of relatively small firms. The firms' products are similar but somewhat different from one another, and there is free entry and exit.
Answer and Explanation:1
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The correct answer is c. Profits are always zero.
The major difference between monopolistically competitive firms and perfectly competitive firms is...
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