Asked by Maryana Bilska on Jul 13, 2024
Verified
In long-run equilibrium for a monopolistically competitive industry,
A) all firms earn a profit.
B) all firms break even.
C) all firms suffer losses.
D) firms can earn a profit, suffer a loss, or break even.
Monopolistically Competitive
Refers to a market structure where many firms sell products that are similar but not identical, allowing for some degree of market power and product differentiation.
Long-run Equilibrium
A condition in the market where all firms in an industry are making zero economic profit, and there is an efficient allocation of resources.
- Understand the conditions for long-run equilibrium in monopolistically competitive markets.
Verified Answer
Learning Objectives
- Understand the conditions for long-run equilibrium in monopolistically competitive markets.
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