The table below summarizes the information possessed by a firm in a monopolistically competitive market. Quantity demanded is in thousands of units.

-Refer to the table above.The optimal quantity produced by the monopolistic competitor is ________.

Question

The table below summarizes the information possessed by a firm in a monopolistically competitive market. Quantity demanded is in thousands of units.
 
-Refer to the table above.The optimal quantity produced by the monopolistic competitor is ________.

Quizplus · Accepted Answer

The monopolistic competitor will produce where marginal revenue equals marginal cost, which is at a quantity of 6,000 units in this case. At this quantity, the monopolistic competitor can charge a price of $13 and will earn a profit of $21,000 ($78,000 in total revenue minus $57,000 in total cost).

The Table Below Summarizes the Information Possessed by a Firm