At its current output level of X = 10, a monopolistically competitive firm has MR = 4, MC =4 ,ATC= 6, and P=8. Is this market in long-run equilibrium? If not, please describe the adjustment process necessary to achieve long-run equilibrium.© BrainMass Inc. brainmass.com October 9, 2019, 9:38 pm ad1c9bdddf
Given that this is a monopolistically competitive firm.
Since the Price P (=8)> ATC=(6)
In this case firm is in earning a profit.
This is a typical case of short term ...
Solution describes the conditions for short term equilibrium conditions for monopolistically competitive firm. It also looks the effect in long run profitability.