Use the following to answer questions:
Figure: Profit Maximization in Monopolistic Competition 
-(Figure: Profit Maximization in Monopolistic Competition) In panel (B) of the figure Profit Maximization in Monopolistic Competition, the profit-maximizing price is P2 and the ATC curve is tangent to the new demand curve. The portion of the ATC that lies to the right of the tangency and continues down to the intersection of MC with ATC indicates:
A) that the firm is incurring an economic loss.
B) that the firm is earning an economic profit.
C) overutilization.
D) excess capacity.
Correct Answer:
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Q148: Monopolistic competition in an industry results in:
A)overutilization
Q149: Use the following to answer questions:
Figure: Profit
Q150: Use the following to answer questions:
Figure: Profit
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Q154: Use the following to answer questions:
Figure: Profit
Q155: Use the following to answer questions:
Figure: Comparing
Q156: Use the following to answer questions:
Figure: Profit
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