For a monopolistic competitor: choose correct and exlain your choice a. P = ATC in long-run equilibrium. b. P > ATC in long-run equilibrium. c. P = MR in long-run equilibrium. d. P = MC in long-run equilibrium.
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For a monopolistic competitor: choose correct and exlain your choice
a. P =
b. P > ATC in long-run equilibrium.
c. P = MR in long-run equilibrium.
d. P = MC in long-run equilibrium.
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- A monopolistically competitive firm is operating in the short run at the optimal level of output and is earning negative economic profits. Which of the following must be true? Select one: a. ATC> P> MR = MC. b. ATC= P> MR = MC. c. ATC> P = MR = MC. d. ATC> P> MR > MC.The monopolistically competitive firm represented in the graph is in: $ $11.40 $10.20 $7.50 0 520 630 MC ATC MR Firm's Demand Quantity Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a long-run equilibrium since it is earning zero profit. b short-run equilibrium since it is earning zero profit. C short-run equilibrium, but not long-run equilibrium since it is earning positive economic profit. d long-run equilibrium, but not short-run equilibrium since it is earning positive economic profit. Your answerQuinn runs an apple orchard in a monopolistically competitive market. Quinn is maximizing profits when they sell apples for $3 per pound, produce 12,000 pounds per year. This set up creates $36,000 in profit per year. Suppose Quinn increases their price to $5. This higher price will: Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a increase profits. b not change profits. cause marginal revenue to exceed marginal cost. d cause marginal cost to exceed marginal revenue. Your answer
- A monopolistically competitive firm produces ________ output than a perfectly competitive firm with the same cost curves.The resulting equilibrium price under monopolistic competition is ________ than the equilibrium price under perfect competition. Question 1Answer a. more; lower b. less; higher c. less; lower d. more; higherExercise A.13. Explain and graph the long-run equilibrium of a monopolistic firm and that of a perfectly competitive firm. Compare both situations in terms of the level of production, prices and economic efficiency.Figure 1 Price Price MR MR MC ATC Quantity MC ATC Price Price MR (d) MC Quantity MC ATC ATC D Quantity Quantity 12. Refer to Figure 1. Which of the graphs depicts a short-run equilibrium that will not encourage either the entry or exit of firms in a monopolistically competitive industry? panel a a. b. panel b C. panel c d. panel d
- We know that monopolistically competitive firms prevent the efficient use of resources because at the monopolistically competitive equilibrium,Hint: "efficient" is measure relative to the perfectly competitive outcome. Question 10Answer a. MR > P. b. P > MC. c. P = MC. d. P > ATC.S Profit Maximization Suppose that a monopolistically competitive restaurant is currently serving 260 meals per day (the output where MR = MC). At that output level, ATC per meal is $10 and consumers are willing to pay $12 per meal. Instructions: Enter your answers as a whole number. a. What is this firm's profit or loss? $ 520 b. Will there be entry or exit? Entry Will this restaurant's demand curve shift left or right? Left In long-run equilibrium, suppose that this restaurant charges $11 per meal for 180 meals and that the marginal cost of the 180th meal is $8. Suppose that the allocatively efficient output level in long-run equilibrium is 210 meals. c. What is the size of the firm's economic profit? $ 460 d. Is the deadweight loss for this firm greater than or less than $90? Less thanMacmillan Learning Increasing Returns to Scale and Monopolistic Competition Starting from the long-run trade equilibrium in the monopolistic competition model, as illustrated in the accompanying figure, consider what happens when industry demand D increases. For instance, suppose that this is the market for cars, and lower gasoline prices generate higher demand D. a. Show the resulting shift in the D/NT, d, and mr curves. Assume the price increases to $13. Place point A on the new short-run equilibrium. Price 09876 20 19 18 17 16 15 11 10 9 8 7 6 5 4 3 2 1 0 mr D/NT d A • AC MC 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Quantity
- Suppose Abercrombie & Fitch sells clothing in a monopolistically competitive market and that a farmer sells oranges in a perfectly competitive market. Part 2 1.) Use the line drawing tool to draw the type of demand curve likely faced by Abercrombie & Fitch. Label this lineDAF. 2.) Use the line drawing tool to draw the type of demand curve faced by an individual orange farmer. Label this line DOranges.33 $100 $90 MC АТС $80 E of $70 $60 $50 $40 $30 Demand = P $20 $10 MR $0 10 20 30 40 50 60 Output (Q) The firm shown in the diagram above is in long run equilibrium in a monopolistically competitive market. According to the graph, the Markup is Select one: а. $40 b. $60 с. $50 d. $30When monopolistically competitive firms earn ________ profits, other firms ________ the industry in the long run. a. normal; exit b. positive economic; enter c. negative economic; enter d. normal; enter