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Any point along LRAC is efficient, and so there's productive efficiency for firms in monopolistic competition.

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why did the teacher say that?

i thought productive efficiency means producing where P = ATC minimum? is she saying that P = ATC on the LRAC curve?

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  1. Because LRAC consists from minimums of SRAC - thus any point along LRAC corresponds to minimum of relevant ATC for the short-run.

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