Suppose you operate in a monopolistically competitive market. If you sell your good at a price of $10 and your average cost of production is $8:
A. your market is in long-run equilibrium.
B. we can expect firms to enter your market and sell a similar good in the long run.
C. there will be no incentive for competing firms to enter your market in the long run.
D. you cannot be in short-run equilibrium.
Answer: B
Economics
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