-The Above Figure Shows the Situation of a Monopolistic Competitor

question 3

Multiple Choice

-The above figure shows the situation of a monopolistic competitor in the short run. The maximum economic profits of the firm equal

• A) $50,000.
• B) $30,000.
• C) 15,000.
• D) zero.

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Definitions:

Short Run

A timeframe in economics during which at least one factor of production is fixed, allowing only some variables to change in response to changes in demand or other influences.

Long Run

An economic interval where all production elements and expenses can fully adapt, as they are changeable, permitting comprehensive adjustments to any variations.

Short Run

A period in economic analysis where at least one production factor is fixed, limiting the ability of the economy or business to adjust immediately.

Long Run

A period of time in economics sufficient for all markets to adjust, including changes in production capacity and market entry or exit.