MONOPOLISTIC COMPETITION AND EFFICIENCY: A monopolistically competitive firm generally produces less output and charges a higher price than would be the case for a perfectly competitive industry. In particular, the price charged by monopolistic competition is not equal to (in fact, higher than) the marginal cost of production. The equality between price and marginal cost is THE key indication that resources are allocated efficiently and that society's resources are NOT being used to generate the highest possible level of satisfaction.

     See also | monopolistic competition | market control | marginal cost | demand curve | market failure | monopolistic competition characteristics | monopolistic competition and demand | inefficiency |

MONOPOLISTIC COMPETITION AND EFFICIENCY, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2025. [Accessed: July 1, 2025].

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The total (or aggregate) real production of final goods and services available in the domestic economy at a range of price levels, during a period of time in which all prices, especially wages, are flexible, and have achieved their equilibrium levels. Long-run aggregate supply, commonly abbreviated LRAS, is one of two aggregate supply alternatives, distinguished by the degree of price flexibility. The other is short-run aggregate supply. Long-run aggregate supply is combined with aggregate demand, and often short-run aggregate supply, in the long-run aggregate market (or AS-AD) analysis used to analyze economic growth, business-cycle instability, unemployment, inflation, government stabilization policies, and related macroeconomic topics.

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