Firm X is a monopolistic competitor. The demand, marginal revenue, and cost curves faced by this firm are shown in the graph below. Notice the AC curve is touching the demand curve at price P1. In the long run, is Firm X's production allocatively efficient? Marginal revenue, marginal cost, average cost, and demand curves on a graph. Dollars on the Y axis and quantity on the X axis. The output level for the firm shows price above the lowest possible average cost