A monopolistically competitive firm faces the following demand schedule for its product. In addition, the firm has total fixed costs equal to 20. Price Quantity $30 $26 $22 $1s $14 $10 $6 Refer to Table 16-7. If the firm produces its profit-maximizing level of output and there is a constant marginal cost of $7 per unit, which of the following is correct? Oa. This firm is operating at its efficient scale. Ob. This firm should expect its demand curve to shift to the left. OC. Firms will leave the market and profits for firms that remain in the market will rise. Od. This firm is in a long-run equilibrium.

A monopolistically competitive firm faces the following demand schedule for its product. In addition, the firm has total fixed costs equal to 20. Price Quantity $30 $26 $22 $1s $14 $10 $6 Refer to Table 16-7. If the firm produces its profit-maximizing level of output and there is a constant marginal cost of $7 per unit, which of the following is correct? Oa. This firm is operating at its efficient scale. Ob. This firm should expect its demand curve to shift to the left. OC. Firms will leave the market and profits for firms that remain in the market will rise. Od. This firm is in a long-run equilibrium.

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter10: Monopolistic Competition And Oligopoly

Section: Chapter Questions

Problem 4QFR

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