Yesterday, I was given $250. as the answer, I got it wrong. Please credit my account for this wrong answer. $250. is not correct answer. The graph shown displays the cost and revenue curves associated with a monopolistically competitive firm. It includes the following curves:- **MC (Marginal Cost):** This curve initially declines, reaches a minimum, and then starts to rise, reflecting the typical shape of marginal cost in relation to quantity produced.- **ATC (Average Total Cost):** This U-shaped curve represents the average total cost per unit of output.- **D (Demand):** This downward-sloping line shows the relationship between price (S) and quantity demanded.- **MR (Marginal Revenue):** This curve is also downward sloping and lies beneath the demand curve, which is characteristic for monopolistic competition.The intersection of the MR and MC curves determines the profit-maximizing output level for the firm. The price at this output level is found by moving up to the demand curve.**Question:**At the profit-maximizing output level, how much profit does this firm earn?1. $2502. $2003. $3604. $450

A monopolistically competitive firm will produce at the point of intersection of marginal revenue and marginal cost. The reason is that beyond that particular point, producing another unit will not yield marginal revenue that is greater than the marginal cost. This is the reason, it is the maximum point where firm can produce without incurring any loss. Based on the given figure, the Marginal Revenue curve intersects the Marginal Cost curve when the quantity produced is 50 units and the price charged for the product is $8. Therefore, the total revenue earned by the firm is Now, the total cost incurred to produce the 50 units is given as Therefore, profit incurred by the firm is Therefore, the correct option is 2. The correct option is 2: $200.