Mary competes in a monopolistically competitive market. Suddenly, 5 new firms enter the market, causing her perceived demand curve to shift. The following tables show her original and new
Mary competes in a monopolistically competitive market. Suddenly, 5 new firms enter the market, causing her perceived demand curve to shift. The following tables show her original and new
Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter10: Monopolistic Competition And Oligopoly
Section: Chapter Questions
Problem 11PAE
Related questions
Question
Mary competes in a
|
Original Demand Curve |
|
|||
|
Price |
Quantity |
TC |
|
|
|
30 |
0 |
$130 |
|
|
|
25 |
10 |
$140 |
|
|
|
20 |
20 |
$260 |
|
|
|
15 |
30 |
$450 |
|
|
|
10 |
40 |
$660 |
|
|
|
New Demand Curve |
|
|||
|
Price |
Quantity |
TC |
|
|
|
25 |
0 |
$130 |
|
|
|
20 |
10 |
$140 |
|
|
|
15 |
20 |
$260 |
|
|
|
10 |
30 |
$450 |
|
|
|
5 |
40 |
$660 |
|
|
Assume that Mary can only choose from the quantities of output given in the table. By how much will the quantity that she produces change after the new firms enter the market?
Question 4 options:
|
increase by 5 |
|
|
decrease by 5 |
|
|
increase by 10 |
|
|
decrease by 10 |
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