A firm in a monopolistically competitive market makes no economic profit in the long run because
A. long-run marginal cost will be too high to make any economic profit.
B. long-run price will be equal to long-run marginal cost.
C. long-run marginal cost will be equal to long-run marginal revenue.
D. long-run price will be equal to long-run average cost.
Answer: D
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The above figure shows the market for rice in Japan. SDomestic represents the domestic supply curve, and Sworld represents the world supply curve. A $1 per unit tariff has the same effect on producer and consumer surplus as a quota of
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