A monopolistically competitive firm is operating at a short-run level of output where price is $21, average total cost is $15, marginal cost is $13, and marginal revenue is $13. In the short run this firm should

Question

Quizplus · Accepted Answer

Since the marginal cost equals the marginal revenue, the firm is maximizing its profit in the short run and should not change its level of output.

A Monopolistically Competitive Firm Is Operating at a Short-Run Level