The price in a long-run equilibrium for a monopolistically competitive firm is __________and output is , compared to that of a perfectly competitive firm with an identical production function and cost curves.
A)higher; greater .
B)higher; smaller
C)lower; greater
D)lower; smaller

Question

Quizplus · Accepted Answer

In monopolistic competition, firms have some market power due to product differentiation, leading to higher prices and smaller output compared to perfectly competitive firms, which produce at the lowest point on the average cost curve.

The Price in a Long-Run Equilibrium for a Monopolistically Competitive