If a Firm Under Monopolistic Competition Is Producing a Quantity

question 36

Multiple Choice

If a firm under monopolistic competition is producing a quantity that generates MC < MR, then the marginal decision rule tells us that profit:

• A) can be increased by increasing production.
• B) can be increased by decreasing production.
• C) can be increased by increasing the price.
• D) is maximized only if MC = P.

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