3. Use the graph below to answer the following questions: a. Profit maximizing output level b. Price charged by the monopolistic competitor c. Total Revenue

Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter10: Monopolistic Competition And Oligopoly
Section: Chapter Questions
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3. Use the graph below to answer the following questions:
a. Profit maximizing output level_
b. Price charged by the monopolistic competitor_
c. Total Revenue_
d. Total Cost_
e. Variable Cost
f. Fixed Cost_
g. Profit or Loss
h. Number of units the firm should produce in the short run and explain why?
i. Number of units the firm should produce in the long run and explain why?
j.
In the long run, (exit/entry)_ will cause the firm's share of the market to
(increase/decrease). and the firm will (decrease/increase) advertising
k. In the long run the firm's costs will (decrease/increase)
will (increase/decrease)
of the market
5453
4.5
4
3.5
2
40 45 50
MC
MR
until loss is driven to
ATC
and the firm's share
AVC
d = firm's
market share
Transcribed Image Text:3 of 7 3. Use the graph below to answer the following questions: a. Profit maximizing output level_ b. Price charged by the monopolistic competitor_ c. Total Revenue_ d. Total Cost_ e. Variable Cost f. Fixed Cost_ g. Profit or Loss h. Number of units the firm should produce in the short run and explain why? i. Number of units the firm should produce in the long run and explain why? j. In the long run, (exit/entry)_ will cause the firm's share of the market to (increase/decrease). and the firm will (decrease/increase) advertising k. In the long run the firm's costs will (decrease/increase) will (increase/decrease) of the market 5453 4.5 4 3.5 2 40 45 50 MC MR until loss is driven to ATC and the firm's share AVC d = firm's market share
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