To maximize profit, a perfectly competitive firm will produce where MR = MC, but a monopoly and a monopolistically competitive firm will produce where price = ATC.

Question

Quizplus · Accepted Answer

A monopoly and a monopolistically competitive firm will also aim to produce where marginal revenue (MR) equals marginal cost (MC) to maximize profit, not where price equals average total cost (ATC).

To Maximize Profit, a Perfectly Competitive Firm Will Produce Where