120 100 80 88 $ 60 40 20 Monopolistically competitive firm 0 0 20 40 60 80 100 120 Q D -MR -ATC -AVC -MC To maximize its profit or minimize its loss, this firm wants to sell about 40 units of output. To sell that many units, the firm will charge a price of about $ 60 ÷ This firm is currently making a positive economic profit ◆ In the long run, we expect that the number of firms in this market will decrease increase remain constant decrease
120 100 80 88 $ 60 40 20 Monopolistically competitive firm 0 0 20 40 60 80 100 120 Q D -MR -ATC -AVC -MC To maximize its profit or minimize its loss, this firm wants to sell about 40 units of output. To sell that many units, the firm will charge a price of about $ 60 ÷ This firm is currently making a positive economic profit ◆ In the long run, we expect that the number of firms in this market will decrease increase remain constant decrease
Chapter12: The Partial Equilibrium Competitive Model
Section: Chapter Questions
Problem 12.9P
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