Figure 17-1

-Refer to Figure 17-1.If a firm in a monopolistically competitive market was producing the level of output depicted as Qd in panel (d),it would

Question

Figure 17-1
 
-Refer to Figure 17-1.If a firm in a monopolistically competitive market was producing the level of output depicted as Qd in panel (d),it would

Quizplus · Accepted Answer

At output level Qd, the marginal revenue (MR) is less than the marginal cost (MC), indicating that the firm is not maximizing its profit. In order to maximize profit, a firm in a monopolistically competitive market should produce where MR=MC, which is at a higher output level than Qd.

Figure 17-1 -Refer to Figure 17-1.If a Firm in a Monopolistically Competitive