In long-run equilibrium in monopolistic competition,price is:

A) greater than average total cost.
B) equal to average total cost at an output below where average total cost is minimized.
C) equal to average total cost at its minimum.
D) equal to average total cost at an output above where average total cost is minimized.

Long-Run Equilibrium

A market condition where all inputs can be adjusted, firms are entering and exiting the market, and no economic profits are made, leading to a state of perfect competition.

Monopolistic Competition

An economic setup in which numerous firms offer products that are alike but not the same, enabling competition to revolve around quality, pricing, and promotional strategies.

Average Total Cost

The average cost per unit of output, calculated by dividing the total cost by the quantity of output produced.