7. short run. (18) The graph below shows the demand curve and marginal revenue curve for a monopolistic competitive firm in the Complete the graph and illustrate this monopolistically competitive firm earning a positive economic profit. Price ($) mr d quantity

Aside from advertising, how can monopolistically competitive films increase demand for their products?

How does a monopolistic competitor choose its profit-maximizing quantity of output and price?

How does a perfectly competitive film calculate total revenue?

Andreas Day Spa began to offer a relaxing aromatherapy treatment. The film asks you how much to charge to maximize profits. The first two columns in Table 10.5 provide the price and quantity for the demand curve for treatments. The third column shows its total costs. For each level of output, calculate total revenue, marginal revenue, average cost, and marginal cost. What is the profit-maximizing level of output for the treatments and how much will the firm earn in profits?

If the firms in a monopolistically competitive market are earning economic profits or losses in the short run, would you expect them to continue doing so in the long run? Why?

The AAA Aquarium Co. sells aquariums for 20 each. Fixed costs of production are 20. The total variable costs are 20 for one aquarium, 25 for two units, 35 for the three units, 50 for four units, and 80 for five units. In the form of a table, calculate total revenue, marginal revenue, total cost, and marginal cost for each output level (one to five units). What is the Profit-maximizing quantity of output? On one diagram, sketch the total revenue and total cost curves. On another diagram, sketch the marginal revenue and marginal cost curves.