Use the Following for Questions 22-31

question 223

Multiple Choice

Use the following for questions 22-31.
Exhibit: Profit Maximization in Monopolistic Competition

-(Exhibit: Profit Maximization in Monopolistic Competition) In Panel (b) , the profit-maximizing price is P₂ and the ATC curve is tangent to the new demand curve.The portion of the ATC that lies to the right of the tangency and continues down to the intersection of MC with ATC indicates _______ , because in the long run in _______ the price would be equal to _______.

• A) unused capacity; oligopoly; MC = minimum ATC
• B) excess capacity; perfect competition; MC = minimum ATC
• C) under-utilization; monopoly; MR = MC
• D) excess capacity; perfect competition; MC > minimum ATC

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Definitions:

Respond

To provide an answer or reply to a question or situation.

Positional Power

The power held by an individual due to their status or position within a structure or organization.

Relational Benefits

Relational benefits refer to the advantages gained from establishing and maintaining long-term relationships with others, often in a business or interpersonal context.

Two-Sided Argument

An argument that presents both the favorable and unfavorable points of an issue.