Which of the following statements is correct? Firms in monopolistic competition and monopoly can earn economic profits in both the short run and the long run. Both perfectly competitive and monopolistically competitive firms charge a price equal to marginal cost. Firms in perfect competition, monopolistic competition, and monopoly maximize profits by producing where marginal revenue equals marginal cost. C Both perfectly competitive and monopolistically competitive firms produce the welfare-maximizing level of output.

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A:

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A: Long run: It means a period of time in which all factors of production and costs are variable.

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