Refer to the graph shown. The monopolistically competitive firm represented is in:
A. short-run equilibrium because price exceeds average total cost at the profit-maximizing output level.
B. both short-run and long-run equilibrium because price equals marginal cost at the profit-maximizing output level.
C. long-run equilibrium because economic profits are zero at the profit-maximizing output level.
D. both short-run and long-run equilibrium because price exceeds average total cost at the profit-maximizing output level.
Answer: A
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