In the model of monopolistic competition, compared to a firm with a lower marginal cost, a firm with a higher marginal cost will set a ________ price, produce ________ output, and earn ________ profits.

Question

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In a model of monopolistic competition, a firm with a higher marginal cost will set a higher price to cover the increased costs, produce less output due to the higher cost of production per unit, and earn less profit because of the higher costs and potentially reduced demand due to the higher price.

In the Model of Monopolistic Competition, Compared to a Firm