​A Monopolistically Competitive Firm Is Currently Charging a Price of $10

question 22

Multiple Choice

​A monopolistically competitive firm is currently charging a price of $10 and producing 12,000 units/month. It faces monthly fixed costs of $15,000 and has an average variable cost of $6/unit. In the long run, we would expect:

• A)​The firm to go out of business
• B)​The price will rise and output will fall
• C)​The price will fall and output will fall
• D)​The price will fall and output will rise

---

Definitions:

Proximal Goals

Short-term objectives or milestones that are set to achieve a larger goal, helping to create a sense of achievement and momentum.

Self-efficacy

The belief in one's own ability to succeed in specific situations or accomplish a task.

Achievement

The act of accomplishing or achieving something challenging through effort, skill, or courage.

Extracurricular Activities

Activities undertaken by students outside of the traditional academic curriculum, which can include sports, clubs, music, art, and more, fostering personal growth and skills development.