A monopolistic competitor is in long-run equilibrium when
A) economic profits are equal to zero and the average total cost curve is tangent to the demand curve.
B) economic profits are equal to zero and the marginal cost curve is tangent to the demand curve.
C) economic profits are greater than zero and the average total cost curve is tangent to the demand curve.
D) economic profits are greater than zero and the marginal cost curve is tangent to the demand curve.
Answer: A
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Marginal social cost is equal to ________
A) marginal private cost plus the marginal external cost B) the marginal external cost C) the value of the tax that will make the market efficient D) the marginal cost imposed on people other than the producer of the good
If the required reserve ratio is 10 percent, an increase in bank reserves of $1,000 can support an increase in checking account deposits (including the original deposit) in the banking system as a whole of up to
A) $100. B) $1,000. C) $10,000. D) $100,000.