Refer to the accompanying graph.The short-run profit-maximizing output for the monopolistic competitive firm is:

Question

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The profit-maximizing output level for a monopolistic competitive firm is when marginal revenue equals marginal cost. In this graph, MC intersects with MR at a quantity of 400 units per day. This is the profit-maximizing output level for the firm. At this output level, the firm will charge a price of $8.50, which is equal to the demand curve at this quantity.

Refer to the Accompanying Graph