Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book
20th Edition
ISBN: 9780078021756
Author: McConnell, Campbell R.; Brue, Stanley L.; Flynn Dr., Sean Masaki
Publisher: McGraw-Hill Education
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Question
Chapter 13, Problem 5DQ
Subpart (a):
To determine
The profits in a monopolistic competition .
Subpart (b):
To determine
The profits in a monopolistic competition.
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$19 16 13 10 0 320. O 600. 100 280. MC 160180 210 Quantity MR Refer to the diagram for a monopolistically competitive firm in short-run equilibrium. This firm's profits will be: ATC -D Jhy
Which of the following statements concerning profit-maximizing firms in long-run equilibrium is
true?
In a purely competitive market, firms produce a level of output where price is greater than average total cost.
In a purely competitive market, firms produce a level of output where price is greater than marginal cost.
O In a monopolistically competitive market, firms produce a level of output at which price exceeds the
minimum average total cost.
In a monopolistically competitive market, firms produce a level of output that exceeds the output where
average total cost is minimized.
What did Harvard economist Edward Chamberlin say about the observation that a
monopolistically competitive firm's average cost of production exceeds its minimum
average total cost?
Select one:
O a. Chamberlin argued that this belief is incorrect. In his view, monopolistically
competitive firms do not produce at a cost above their minimum average total costs.
O b. Chamberlin argued that these higher costs represent the wastefulness of this
market structure.
O c. In Chamberlin's view, this is evidence that monopolistic competition uses society's
resources inefficiently and in a fashion that merits government intervention.
O d. According to Chamberlin, this cost difference represents the value consumers place
on variety and having more choice.
Chapter 13 Solutions
Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book
Ch. 13.1 - Prob. 1QQCh. 13.1 - Prob. 2QQCh. 13.1 - Prob. 3QQCh. 13.1 - Prob. 4QQCh. 13.4 - Prob. 1QQCh. 13.4 - The D2e segment of the demand curve D2eD1 graph...Ch. 13.4 - Prob. 3QQCh. 13.4 - Prob. 4QQCh. 13.A - Prob. 1ADQCh. 13.A - Prob. 2ADQ
Ch. 13.A - Prob. 3ADQCh. 13.A - Prob. 4ADQCh. 13.A - Prob. 1ARQCh. 13.A - Prob. 2ARQCh. 13.A - Prob. 3ARQCh. 13.A - Prob. 1APCh. 13.A - Prob. 2APCh. 13 - Prob. 1DQCh. 13 - Prob. 2DQCh. 13 - Prob. 3DQCh. 13 - Prob. 4DQCh. 13 - Prob. 5DQCh. 13 - Prob. 6DQCh. 13 - Prob. 7DQCh. 13 - Prob. 8DQCh. 13 - Prob. 9DQCh. 13 - Prob. 10DQCh. 13 - Prob. 11DQCh. 13 - Prob. 12DQCh. 13 - Prob. 13DQCh. 13 - Prob. 1RQCh. 13 - Prob. 2RQCh. 13 - Prob. 3RQCh. 13 - Prob. 4RQCh. 13 - Prob. 5RQCh. 13 - Prob. 6RQCh. 13 - Prob. 7RQCh. 13 - Prob. 8RQCh. 13 - Prob. 1PCh. 13 - Prob. 2PCh. 13 - Prob. 3P
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- Suppose that an monopolistically competitive restaurant is currently serving 230 meals per day (the output where MR = MC). At that output level, ATC per meal is $10 and consumers are willing to pay $12 per meal. What is the size of this firm's profit or loss? Profit Will there be entry or exit? Entry > of $ 460 Will this restaurant's demand curve shift left or right? Left In long-run equilibrium, suppose that this restaurant charges $11 per meal for 180 meals and that the marginal cost of the 180th meal is $8. What is the size of the firm's profit? $ 540 xarrow_forwardQUESTION 1 Press F11 to exit full screen Which firm would earn profit in the long-run? O a monopolist firm. O a monopolistically competitive firm. O an oligopoly firm. O a perfectly competitive firm. QUESTION 2 Refer to the graph below for a monopolistically competitive firm. ↑Price MC 160 140 ATC 123.33 Demand 90 56.67 MR 100 133.33 154.92 Quantity If the above firm chose to produce at 100 units then the firm will be O earning a profit O incurring a loss O there is no profit and no loss O the firm can earn, profit, loss or break evenarrow_forwardQuestion 24 A monopolistically competitive market is like both a competitive market and a monopoly in that all three market structures feature easy entry by new firms in the long run. firms in all three market structures maximize profit by producing an output level where marginal revenue equals marginal cost. C firms in all three market structures produce the welfare-maximizing level of output. O All of the above are correct. Quizarrow_forward
- Lii Question 29 What is this monopolistic competitive firm's total profit? Search & 7 4 Total Marginal Quantity Price Revenue Revenue Total cost Marginal Cost Average Cost 10 $23 $230 $340 $34 20 $20 $400 $17 $400 $6 $20 30 $18 $540 $14 $480 $8 $16 40 $16 $640 $10 $580 $10 $14.50 50 $14 $700 $6 $700 $12 $14 60 $12 $720 $2 $840 $14 $14 70 $10 $700 -$2 $1,020 $18 $14.57 80 $8 $640 -$6 $1,280 $26 $16 Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer. a $60 b $0 C $720 d $840 * 18 8 وا 144 hp f10 ||4 144 f12 + 口 prt sc delete home 11:25 A 7/2/20 num = ← backspace lockarrow_forwardSuppose that an monopolistically competitive restaurant is currently serving 270 meals per day (the output where MR = MC). At that output level, ATC per meal is $10 and consumers are willing to pay $13 per meal. What is the size of this firm's profit or loss? Profit of $ Will there be entry or exit? Entry k Will this restaurant's demand curve shift left or right? Left In long-run equilibrium, suppose that this restaurant charges $11 per meal for 180 meals and that the marginal cost of the 180th meal is $9. ices What is the size of the firm's profit? $ MacBook Airarrow_forwardQuestion 2 AnimoSpace Support ? Given the perfect competitor firm's supply curve below, what is the shutdown price? P(cost) MC AC 80 AVE 70 60 50 40 30 20 (10,10) 10 10 20 30 40 50 60 70 80 90 100 110 12 Qty Break-even quantity: Shutdown price: O 50 O 70 O 35 IS O 80 O 5 a Question 3 Which of these market structures is not correctly described? Monopolistic Nliaonoly Mononolhe o searcharrow_forward
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