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In the long run, a profit-maximizing monopolistically competitive firm sets it price Multiple Choice above marginal cost. below marginal cost. equal to marginal revenue equal to marginal cost.

Sagot :

In the long run, a profit-maximizing monopolistically competitive firm sets its price equal to marginal revenue equal to marginal cost. The correct option is C.

What happens to a monopolistic competitive firm in the long run?

Long-term economic gains or losses in monopolistic competition will be eliminated by entry or exit, leaving firms with no economic gains. There will be some excess capacity in a monopolistically competitive industry; this could be seen as the price paid for the variety of products that this market structure brings about.

By equating marginal cost and marginal revenue in a monopolistic market and solving for the cost of a single good and the necessary production volume, a firm can maximize its overall profit.

Thus, the ideal selection is option C.

Learn more about the monopolistic competition here:

https://brainly.com/question/29612892

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