Generally, the monopolistic competitor is in long run equilibrium when MRMC and P = ATC. P=MC = ATC. P = MC and P> ATC. MR = MC = ATC. b and d
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- Which of the following is correct for a monopolistically competitive firm in long-run equilibrium? Multiple Choice MC = ATC. MC exceeds MR. P exceeds minimum ATC. P = MC.Candak Corporation produces professional quality digital cameras. The market for professional digital cameras is monopolistically competitive. Assume that the inverse demand curve faced by Candak (given its competitors’ prices) can be expressed as P = 5,000 - .2Q and Candak’s total costs can be expressed as TC = 20,000,000 + .05Q2. Answer the following questions. A. What price and quantity will Candak choose? B. Is this likely to be a long-run equilibrium for Candak Corporation? Why or why not? If not, what is likely to happen in the market for professional digital cameras, and how will it affect Candak?Consider a monopolistically competitive market in long-run equilibrium, and a firm that is in the market. Suppose there is a shortage of a key input, so that every firm's ATC curve shifts up by a fixed amount. If the firm remains in the market in the new long-run equilibrium, what happens to the price at which it sells the good, and what quantity does it sell? Price goes down, quantity stays the same Price goes up, quantity stays the same Price goes down, quantity goes down Price goes up, quantity goes down
- In the long run, monopolistically competitive firms produce a level of output such that Multiple Choice P>MC. P ATC ATC minimum of average costs. All of the statements associated with this question are correct.In the short-run, a monopolistically competitive firm: Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. b will produce at the point where marginal revenue is greater than marginal cost, in order to maximize profits. Your answer C can earn only a normal profit. d will produce at the point at which price equals minimum ATC, to maximize profits. will shut down temporarily if price is less than AVC.ou are hired as a consultant to a monopolistically competitive firm. The firm reports the following information about its price, marginal cost, and average total cost: P<MC, P>ATCP<MC, P>ATC Which of the following statements are true about the firm? Check all that apply. The firm is possibly maximizing profit. The firm is in long-run equilibrium. The firm can increase its profit by reducing its output.
- Suppose you manage a firm in a monopolisticallycompetitive market. Which of the following strategies will do a better job of helping you maintaineconomic profits: obtaining a celebrity endorsement for your product or supporting the entry offirms that will compete directly with your biggestrival? Explain your answer.A firm in an oligopolistic industry has the following demand and total cost equations: P = 600 - 20Q TC = 700 + 160Q + 15Q*2 Calculate: a. quantity at which profit is maximized b. maximum profit c. quantity at which revenue is maximized d. maximum revenue e. maximum quantity at which profit will be at least $580 f. maximum revenue at which profit will be at least $580Burger King is a monopolistically competitive firm. Suppose Burger King's demand increases but its costs remain the same. As a result, Burger King the quantity of meals it produces and their price. decreases; raises increases; lowers increases; does not change decreases; does not change None of the above are correct.
- In the long-run equilibrium of a monopolistically competitive industry, the zero-profit point is to the leftof minimum average cost. EXPLAIN. WHY?Refer to the diagrams, which pertain to monopolistically competitive firms. Long-run equilibrium is shown by diagram b only. diagram a only. none of these diagrams. diagram c only.The figure below shows the demand (D, MR) and cost (MC, ATC) curves for Gwen's Country Curtains, operating in a monopolistically competitive industry. Demand and cost conditions facing Gwen's Country Curtains MC Dollars 80 0 ATC 1,000 MR Number of curtains per month Suppose Gwen's Country Curtains is currently producing 1000 curtains per month at a price of $80. In the short run, this company is and in the long run, it should expect to a. earning zero profit; earn zero profit b. suffering a loss; earn zero profit c. suffering a loss; shut down d. making a profit; earn zero profit
