Compare the average cost and the output in the long-run equilibrium for a monopolistically competitive firm and a perfectly competitive firm bycompleting the following table.Average CostOutputUnder...(Dollars per jacket)(Thousands of jackets per month)Monopolistic CompetitionPerfect CompetitionBecause this market is a monopolistically competitive market, the firm's average cost in long-run equilibrium isthe long-runaverage cost it would achieve as a firm operating in a perfectly competitive market.The output of a monopolistically competitive firm in long-run equilibrium isthe output of a perfectly competitive firm. Thisdifference in output is known as theof a monopolistically competitive firm. Suppose that a firm produces wool jackets in a monopolistically competitive market. The following graph shows its demand curve (D), marginalrevenue curve (MR), marginal cost curve (MC), and long-run average cost curve (LRAC). Assume that all firms in the industry face the same coststructure.Place the tan point (dash symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next,place the purple point (diamond symbol) to indicate the point at which this firm would produce in the long run if it operated in a perfectly competitivemarket.Note: Dashed drop lines will automatically extend to both axes.(?)10090Monopolistic Competition Outcome807060Perfect Competition OutcomeLRAC5040302010MCMR102030405060708090100QUANTITY (Thousands of jackets per month)PRICE, COSTS, AND REVENUE (Dollars per jacket)

In a monopolistic competitive firm there are large number of firms selling similar but not identical…

mpare the average cost and the output in the long-run equilibrium for a monopolistically competitive firm and a perfectly competitive firm mpleting the following table. Average Cost Output Under... (Dollars per jacket) (Thousands of jackets per month) lonopolistic Competition Perfect Competition cause this market is a monopolistically competitive market, the firm's average cost in long-run equilibrium is the long-run erage cost it would achieve as a firm operating in a perfectly competitive market. e output of a monopolistically competitive firm in long-run equilibrium is the output of a perfectly competitive firm. This erence in output is known as the of a monopolistically competitive firm.

mpare the average cost and the output in the long-run equilibrium for a monopolistically competitive firm and a perfectly competitive firm mpleting the following table. Average Cost Output Under... (Dollars per jacket) (Thousands of jackets per month) lonopolistic Competition Perfect Competition cause this market is a monopolistically competitive market, the firm's average cost in long-run equilibrium is the long-run erage cost it would achieve as a firm operating in a perfectly competitive market. e output of a monopolistically competitive firm in long-run equilibrium is the output of a perfectly competitive firm. This erence in output is known as the of a monopolistically competitive firm.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A monopolistically competitive firm in a long-run equilibrium will likely produce which of the following? A. a technically efficient amount of outputB. less than a technically efficient amount of output and less than an allocatively efficient amount of outputC. more than a technically efficient amount of output but less than an allocatively efficient amount of outputD. an allocatively efficient amount of production.E. less than a technically efficient amount of output and more than an allocatively efficient
1. Briefly discuss the various ways monopolistically competitive firms can differentiate their products? 2. In the long-run, a perfectly competitive firm will earn what kind of economic profit?
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3. A monopolistically competitive firm sells boots and has the following in the short run: Demand: P = 80 – 0.5Q %3D MR: MR = 80 – Q TC = 1.5Q? + 40 1.5Q + (40/Q) TC: АТC: MC: MC = 3Q %3D Find the firm's profit maximizing quantity and price. Find the firm's profit or loss. Show some work here: Quantity = Price = Profit or Loss = (circle one, and write the number)
Part II | The graph below shows a monopolistically competitive firm in the short run. Price and Cost 8 9 8 20 0 100 MR 200 300 400 500 600 700 800 Output MC 9. What is the firm's profit-maximizing price and quantity? 10. How much profit does that firm make at that price and quantity? 900 ATC -d-p
5. How short-run profit or losses induce entry or exit Citrus Scooters is a company that manufactures electric scooters in a monopolistically competitive market. The following graph shows the demand curve, marginal revenue curve (MR), marginal cost curve (MC), and average total cost curve (ATC) for Citrus. Place the black point (plus symbol) on the graph to indicate the short-run profit-maximizing price and quantity for this monopolistically competitive company. Then, use the green rectangle (triangle symbols) to shade the area representing the company's profit or loss. PRICE (Depar 500 450 350 300 250 300 150 100 MC 50 50 100 ATC MR Demand 150 200 250 300 350 400 450 500 QUANTITY (Scooters) +- Monopolically Comp Profit or Lasa ▼profit, which means there are Given the profit-maximizing choice of output and price, Citrus Scooters is earning sellers in the industry relative to the long-run equilibrium amount. Now consider the long run in which scooter manufacturers are free to enter and…
PRICE (Dollars per engine) 100 90 80 70 60 40 30 & 2 20 10 MO D 0 10 ATC MR Demand 20 30 40 50 60 70 DO 90 QUANTITY (Thousands of engines) 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 optimal quantity. Furthermore, a monopolistically competitive firm's average total cost in long-run equilibrium is average total cost. at the the minimum
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