Which Two Curves Are Tangent to One Another in a Monopolistically

question 117

Multiple Choice

Which two curves are tangent to one another in a monopolistically competitive market with zero economic profit

• A)demand and average variable cost
• B)demand and average total cost
• C)marginal revenue and average variable cost
• D)marginal revenue and average total cost

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Definitions:

Economic Profit

The disparity between what a company earns in total and what it spends, counting both direct and indirect costs.

Self-Interest

The motivation driving individuals to pursue their own benefits or advantages, often considered a fundamental economic assumption.

Guiding Function Of Prices

The role of prices in signaling to both buyers and sellers about the relative scarcity or abundance of goods and services, thus guiding their economic decisions.

System Accommodate Change

A system's ability to adjust or adapt to changes in its environment or operations, ensuring continued functionality or efficiency.