Figure 11-17
-Refer to Figure 11-17.In the long run,why will the firm produce Qf units and not Qg units,which has a lower its average cost of production?
A) Although its average cost of production is lower when the firm produces Qg units, to be able to sell its output the firm will have to charge a price below average cost, resulting in a loss.
B) At Qg, average cost exceeds marginal cost so the firm will actually make a loss.
C) At Qg, marginal revenue is less than average revenue which will result in a loss for the firm.
D) The firm's goal is to charge a high price and make a small profit rather than a low price and no profit.
Correct Answer:
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Q190: If a firm has excess capacity, then
A)the
Q195: Figure 11-18 Q196: Figure 11-17 Q197: Consumers benefit from monopolistic competition by Q198: Figure 11-17 Q199: In contrast with perfect competition, excess capacity Q206: Consumers in monopolistically competitive markets face a Q213: In the long-run equilibrium, both the perfectly Q217: If a significant number of consumers switch Q218: In the long-run equilibrium, a monopolistically competitive Unlock this Answer For Free Now! View this answer and more for free by performing one of the following actions Scan the QR code to install the App and get 2 free unlocks Unlock quizzes for free by uploading documents
A)being able
