Solved

The Diagram Below Shows Demand and Cost Curves for a Monopolistically

Question 77

Multiple Choice

The diagram below shows demand and cost curves for a monopolistically competitive firm. The diagram below shows demand and cost curves for a monopolistically competitive firm.   FIGURE 11-3 -Refer to Figure 11-3.In the long run,a monopolistically competitive firm will A) make profit by producing at Q<sub>2</sub> and charging price P<sub>1</sub>. B) lose money by producing at Q<sub>1</sub> and charging price P<sub>2</sub>. C) maximize profit and make positive profit by producing at Q<sub>1</sub> and charging price P<sub>1</sub>. D) maximize profit but only break even by producing at Q<sub>1</sub> and charging price P<sub>1</sub>. E) maximize profit by producing output level Q<sub>2</sub>,the minimum point of its LRAC curve. FIGURE 11-3
-Refer to Figure 11-3.In the long run,a monopolistically competitive firm will


A) make profit by producing at Q2 and charging price P1.
B) lose money by producing at Q1 and charging price P2.
C) maximize profit and make positive profit by producing at Q1 and charging price P1.
D) maximize profit but only break even by producing at Q1 and charging price P1.
E) maximize profit by producing output level Q2,the minimum point of its LRAC curve.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents