A monopolistically competitive firm faces the following demand schedule for its product. In addition, the firm has total fixed costs equal to 20. Price $30 $26 $22 $18 $14 $10 $6 Quantity 1 2 3 4 5 6 7 If the firm produces its profit-maximizing level of output and there is a constant marginal cost of $7 per unit, which of the following is incorrect? This firm earns $25 profit at the profit-maximizing level of output. This firm is not operating at its efficient scale. This firm is in a long-run equilibrium. This firm charges a price of $22 to maximize its profit.

A monopolistically competitive firm faces the following demand schedule for its product. In addition, the firm has total fixed costs equal to 20. Price $30 $26 $22 $18 $14 $10 $6 Quantity 1 2 3 4 5 6 7 If the firm produces its profit-maximizing level of output and there is a constant marginal cost of $7 per unit, which of the following is incorrect? This firm earns $25 profit at the profit-maximizing level of output. This firm is not operating at its efficient scale. This firm is in a long-run equilibrium. This firm charges a price of $22 to maximize its profit.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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