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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The accompanying graph depicts average total cost (ATC) marginal cost (MC), marginal revenue (M), and demand (D) 50 facing a monopolistically competitive firm MC 45 Place point A at the firm's profit maximizing price and quantity 40 35 What is the firm's total cost? ATC 30 25 total cost: 20 15 What is the firm's total revenue? 10 5 total revenue: $ MR 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95100 Quantity What is the firm's total profit? profit: $ Price and Cost ($)
Part II | The graph below shows a monopolistically competitive firm in the short run. $ 10 6 4 MC ATC 10 25 30 9. What is the firm's profit-maximizing price and quantity? 10. How much profit does that firm make at that price and quantity? 60
Q. 2
3. Discuss the long debate of economists whether there is a significant loss of well-being to society in markets that are monopolistically competitive rather than perfectly competitive
Question 21 A firm is a price taker only when the market is perfectly competitive. only when the market is perfectly competitive or monopolistic. Oonly when the market is perfectly competitive or monopolistically competitive. when the market is perfectly competitive, monopolistically competitive, or monopolistic. Question 22
9 of 15 Warwick Inc. produces in a monopolistically compettive market. Which of the following corectly explains howa fmin this market struchure would transition trom the short run to the long run? O The supemomal profits eamed by Warwick Inc in the short run will attract new firma into the market. This wil shit the market supply curve to the right, which will reduce the market price and the price faced by Warwick ine. The price wil keep falling until Average Revenue equals Average Cost and only normal profits are made. O The supermormal profits eamed by Warwick Inc. in the short run will attract new firms into he martet. This wil shit Warwick ine. demand curve to the left and t wit continue to shit left until Average Revenue equals Average Cost and only normal profits are made O The supemomal profits eamed by Wanwick Inc. in the short run will lead to the market demand aurve shifing to the right, which will raise the price fims can sell at and ts wil atract now frms into the market.…
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How would you best describe the economic profit (or loss) at the profit maximizing quantity q* in the long run for a monopolistically competitive firm? a) both a profit and a loss b) a profit c) a loss d) neither a profit nor a loss Is this monopolistically competitive firm efficient in production in the long run? Please state yes, no, it depends, and explain why in a few words or a formula. MC ATC 0 MR D
Explain the profit-maximizing output leveland profitof a monopolistic firm by drawing a graph. What are the advantages of internal economies of scale? Explain them briefly. What is the meaning of ‘acceptable loss’for a perfectly competitive firm ? Draw a graph and explain. How can we increase the Total Revenue of productsby using elasticity? Explain them briefly.
Discuss the long-term effects in a monopolistically competitive market if an existing firm is making profits or losses. Use graphs to help your explanations.
The graph depicts a monopolistically competitive firm. Assuming the firm's ATC is ATC', the firm's current economic profit (per day) is_____, and its long-run economic profit is _____. Price and cost $40 30 23 20 10 0 $3,000; $0 $1,500; $0 $1,500; $2,500 $4,000; $3,000 MR 150 200 MC ATC ATC AR=D Quantity (per day)