10 Suppose price exceeds average total cost for a monopolistically competitive firm. The firm should definitelya) increase outputb) experience economic profitsc) should decrease outputd) should raise its priceQuestion 4Suppose the monopolistically competitive firm is charging a price equal to average total cost. The monopolistically competitive firma) increases its outputb) decreases its outputOc) is operating in the long rund) can expect new firms to enter

In monopolistic competitive firm, there are many buyers and sellers with some control over the price…

Suppose price exceeds average total cost for a monopolistically competitive firm. The firm should definitely a) increase output b) experience economic profits c) should decrease output d) should raise its price

Suppose price exceeds average total cost for a monopolistically competitive firm. The firm should definitely a) increase output b) experience economic profits c) should decrease output d) should raise its price

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter14: Monopolistic Competition And Product Differentiation

Section: Chapter Questions

Problem 10P

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Question

Suppose price exceeds average total cost for a monopolistically competitive firm. The firm should definitely
a) increase output
b) experience economic profits
c) should decrease output
d) should raise its price
Question 4
Suppose the monopolistically competitive firm is charging a price equal to average total cost. The monopolistically competitive firm
a) increases its output
b) decreases its output
Oc) is operating in the long run
d) can expect new firms to enter

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