Figure 10.4 shows the demand, marginal revenue, and cost curves for a monopolistic competitor. At the profit-maximizing output level, the firm is:
Figure 10.4

A) earning an economic profit of $760.
B) earning an economic profit of $950.
C) earning zero economic profit.
D) earning an economic profit of $990.
E) suffering a loss of $1,000.
Correct Answer:
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