Monopolistic competitive firms are productively inefficient because production occurs where

A) price is greater than marginal revenue.
B) marginal cost is less than price.
C) marginal cost is not at its lowest.
D) average total cost is not at its lowest.

Productive Inefficiency

A situation in which a firm or economy is not producing goods and services at the lowest possible cost, often due to misallocation of resources or other factors.

Marginal Cost

The monetary cost of manufacturing one more unit of a good or service.

Average Total Cost

The total cost of production divided by the number of goods produced, representing the cost per unit of output.