The Short-Run Equilibrium for a Monopolistically Competitive Firm Is at P

question 38

Multiple Choice

The short-run equilibrium for a monopolistically competitive firm is at P = $28.47, ATC = $22.13, and MC = MR = $17.47. Which of the following is true?

• A) Per-unit profit is $11.
• B) Additional firms will be attracted into the industry.
• C) The firm could raise price and increase profits.
• D) The firm could lower price and increase profits.
• E) Average cost must be rising.

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Intellectual Disability

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