Exhibit 9-2 A monopolistic competitive firm As presented in Exhibit 9-2, the long-run profit-maximizing output for the monopolistic competitive firm is:

Question

Exhibit 9-2  A monopolistic competitive firm  As presented in Exhibit 9-2, the long-run profit-maximizing output for the monopolistic competitive firm is:

Quizplus · Accepted Answer

In the long run, a monopolistic competitive firm will produce where marginal revenue equals marginal cost, and charge a price based on the demand for their product. At the output level of 200 units per week in Exhibit 9-2, marginal revenue equals marginal cost, indicating that this is the profit-maximizing output level. At this output level, the firm can charge a price of $10, which is where the demand curve intersects the marginal revenue curve. Therefore, the long-run profit-maximizing output for the monopolistic competitive firm is 200 units per week.

Exhibit 9-2 a Monopolistic Competitive Firm as Presented in Exhibit