In the Long Run, a Monopolistically Competitive Firm Charges a Higher

Multiple Choice

In the long run, a monopolistically competitive firm charges a higher price than a perfectly competitive firm. The reason for this difference is that monopolistically competitive firms

A) act like monopolies and restrict output.
B) have higher costs associated with advertising and product development.
C) need to earn economic profits in the long run to justify their expenditures on product development.
D) are able to price discriminate.