When a monopolistically competitive firm is in long-run equilibrium, what is the case? A. Price equals marginal revenue. B. Price is equal to average total cost. C. Price equals marginal cost. D. Price is equal to minimum average total cost.
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I need help with econ multiple hw questions asap!
87) When a
- A. Price equals marginal revenue.
- B. Price is equal to
average total cost . - C. Price equals marginal cost.
- D. Price is equal to minimum average total cost.
86)
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- Make a case for why monopolistically competitive industries never reach long-run equilibrium.4. Pat's Hair Designs is part of a monopolistically competitive haircut market in Berkeley. (a) At present, Pat is earning positive profits by running the haircut business. Draw a diagram illustrating Pat's profit-maximizing price and quantity of haircuts. Explain what your diagram shows, including a descritpion of what each line in your diagram represents. (b) Is the haircut market in Berkeley in long-run equilibrium? If it is, explain why. If it is not, draw a diagram illustrating Pat's profit-maximizing price and quantity of haircut in the long-run equilibrium (Assume Pat's remains in the market). Explain how the market moves from the equilibrium you drew in (a) to the one here. (In other words, explain which curves move and why.)3. GB Motor Company produced 600,000 bikes at a price of $440 each. The company made a profit of $60 million that year. The CEO of the company told a journalist that he intended to reduce the price of their bikes to $360, and he expected to sell 900,000 bikes at that price. d) Should a monopolistically competitive firm consider its fixed costs when deciding how much to produce? (Explain in less than 50 words.)
- 2. Draw a graph which depicts a short-run equilibrium that will cause exit of firms from a monopolistically competitive industry.4. Is monopolistic competition efficient? Suppose that a company operates in the monopolistically competitive market for pickleball paddles. The following graph shows the demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve for the firm. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. (?) PRICE (Dollars per paddle) 100 R 60 50 40 30 20 10 0 0 MC ATC MR 10 20 30 40 50 60 QUANTITY (Thousands of paddies) 70 Demand 80 90 100 + Mon Comp Outcome Min Unit Cost Because this market is monopolistically competitive, you can tell that it is in long-run equilibrium by the fact that at the optimal quantity for each firm. Further, a monopolistically competitive firm's average total cost in long-run equilibrium is…4. Is monopolistic competition efficient? Suppose that a company operates in the monopolistically competitive market for electric razors. The following graph shows the demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve for the firm. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Nex place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. PRICE (Dollars per razor) 100 90 80 70 60 50 40 30 20 MC 10 ATC MR Demand 0 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of razors) Mon Comp Outcome * Min Unit Cost at the optimal quantity the efficient scale. Because this market is monopolistically competitive, you can tell that it is in long-run equilibrium by the fact that each firm. Further, the quantity the firm produces in long-run equilibrium is True or False:…
- Σ B. 20 10 50 30 20 PRICE (Dollars per bat) Homework (C (91. 4. Is monopolistic competition efficient? Suppose that a firm produces baseball bats in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. 06 Mon Comp Outcome Min Unit CAst 09 40 10 MR Demand pleuwe 09 06 QUANTITY (Thousands of bats) Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that ▼ at the optimal eticall the miair MacBook Pro ACID & 5. R H N command commc-State and explain briefly 2 differences between a perfectly competitive market and a monopolistic competitive market.4. Is monopolistic competition efficient? Suppose that a firm produces baseball bats in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. PRICE (Dollars per bat) 100 90 80 70 60 8 50 40 30 20 10 0 MC 0 10 ATC O True MR False Demand 20 30 40 50 60 70 QUANTITY (Thousands of bats) 80 90 100 Mon Comp Outcome Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that optimal quantity for each firm. Furthermore, the quantity the firm produces in long-run equilibrium is Min Unit Cost True or False: This indicates that…
- 3. Assume that a profit-maximizing firm in a monopolistically competitive industry is in long-run equilibrium. (a) Draw a correctly labeled graph that shows the profit-maximizing firm's price and output. (b) Assume that the city in which this industry operates eliminates the business license fee (a fixed cost) for all firms in this industry. How does the elimination of the license fee affect each of the following for the individual firm in the short run? Explain your answers. (i) Output (ii) Economic profits4. Is monopolistic competition efficient? Suppose that a firm produces wool jackets in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. (?) PRICE (Dollars per jacket) 100 90 80 70 60 50 30 20 10 0 0 MC 10 True ATC MR 20 30 40 50 60 70 QUANTITY (Thousands of jackets) False 80 Demand 90 100 Mon Comp Outcome Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that quantity for each firm. Furthermore, the quantity the firm produces in long-run equilibrium is the efficient scale. Min Unit Cost True or False: This…4. Is monopolistic competition efficient? Suppose that a company operates in the monopolistically competitive market for denim jackets. The following graph shows the demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve for the firm. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. PRCE (Dollars per jacket) 2882332RR 100 90 60 50 20 0 Mto 10 10 ATC MR 20 30 40 50 00 70 QUANTITY (Thousands of jackets) Demand 80 90 100 Mon Comp Outcome Min Unit Cost