Figure 7.3
-For the monopolistic competitor depicted in Figure 7.3, what quantity would have to be produced in order for the firm to engage in marginal-cost pricing?

Question

Quizplus · Accepted Answer

The firm would have to produce 100 units in order to engage in marginal-cost pricing. At this quantity, the marginal cost (MC) curve intersects the demand curve (D) at point E. At point E, the price (P) is equal to the marginal cost (MC), which is the condition for marginal-cost pricing.

Figure 7.3 -For the Monopolistic Competitor Depicted in Figure 7.3, What Quantity