A Monopolistic Competitor Is Producing a Level of Output at Which

question 3

Multiple Choice

A monopolistic competitor is producing a level of output at which price is $200,marginal revenue is $100,average total cost is $210,marginal cost is $100,and average variable cost is $180.In order to maximize profit,the firm should

• A)increase output.
• B)keep output the same.
• C)decrease output.
• D)shut down.

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Definitions:

Focus

A point used in the definitions of conic sections, such as ellipses and hyperbolas, from which distances are measured to define the curves.

Vertex

The point where two lines, or edges, of a geometric figure meet; in the context of a parabola, the peak or the lowest point, depending on its orientation.

Circle

A round plane figure, every point of which is equidistant from a fixed center point, defined by the equation (x-h)^2 + (y-k)^2 = r^2 in a coordinate plane.

Radius

The distance from the center of a circle to any point on its circumference.