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In the Long Run, If the Demand Curve of a Profit-Maximizing

Question 187

Multiple Choice

In the long run, if the demand curve of a profit-maximizing monopolistically competitive firm is tangent to its average total cost curve, then


A) the firm would break even.
B) the firm would shut down temporarily.
C) the firm would earn enough revenue to cover its variable costs, but not its fixed costs.
D) the firm would earn an economic profit.

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