===>Please give me proper explanation Note:-Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.Answer completely.You will get up vote for sure. 4. Is monopolistic competition efficient?Suppose that a firm produces wooden train engines in a monopolistically competitive market. The following graph shows its demand curve, marginalrevenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curvePlace a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next,place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost.?1009080PRICE (Dollars per engine)7060504030201000MC1020ATC40MR30506070QUANTITY (Thousands of engines)80Demand90100Mon Comp Outcome.Min Unit Cost Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact thatquantity for each firm. Furthermore, a monopolistically competitive firm's average total cost in long-run equilibrium isaverage total cost.True or False: This indicates that there is a markup on marginal cost in the market for engines.TrueFalseat the optimalMonopolistic competition may also be socially inefficient because there are too many or too few firms in the market. The presence of theexternality implies that there is too little entry of new firms in the market.the minimum

Monopolistic competition is such market where there are large number of buyers and sellers selling…

Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that quantity for each firm. Furthermore, a monopolistically competitive firm's average total cost in long-run equilibrium is average total cost. True or False: This indicates that there is a markup on marginal cost in the market for engines. True False at the optimal Monopolistic competition may also be socially inefficient because there are too many or too few firms in the market. The presence of the externality implies that there is too little entry of new firms in the market. the minimum

Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that quantity for each firm. Furthermore, a monopolistically competitive firm's average total cost in long-run equilibrium is average total cost. True or False: This indicates that there is a markup on marginal cost in the market for engines. True False at the optimal Monopolistic competition may also be socially inefficient because there are too many or too few firms in the market. The presence of the externality implies that there is too little entry of new firms in the market. the minimum

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

===>Please give me proper explanation

Note:-

Do not provide handwritten solution. Maintain accuracy and quality in your answer.

Take care of plagiarism.

Answer completely.

You will get up vote for sure.

4. Is monopolistic competition efficient?
Suppose that a firm produces wooden train engines in a monopolistically competitive market. The following graph shows its demand curve, marginal
revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve
Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next,
place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost.
?
100
90
80
PRICE (Dollars per engine)
70
60
50
40
30
20
10
0
0
MC
10
20
ATC
40
MR
30
50
60
70
QUANTITY (Thousands of engines)
80
Demand
90
100
Mon Comp Outcome.
Min Unit Cost

Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that
quantity for each firm. Furthermore, a monopolistically competitive firm's average total cost in long-run equilibrium is
average total cost.
True or False: This indicates that there is a markup on marginal cost in the market for engines.
True
False
at the optimal
Monopolistic competition may also be socially inefficient because there are too many or too few firms in the market. The presence of the
externality implies that there is too little entry of new firms in the market.
the minimum

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