Economics 9708 · AS & A Level · 7.6

7.6 — practice question

The diagram illustrates the cost and revenue curves for a profit-maximising firm operating under monopolistic competition in long-run equilibrium. Which statement best describes the performance of this firm?

  • AIt is allocatively efficient.
  • BIt is making abnormal losses.
  • CIt is making abnormal profits.
  • DIt is making normal profits.

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