The following graph shows a firm producing jeans in a monopolistically competitive market. The firm faces a downward-sloping, linear demand curve, D. The marginal revenue curve of the firm is shown by MR. AC and MC are the average total cost and marginal cost curves of the firm. Which of the following is likely to true of the firm at the profit-maximizing point?Figure 9.3: 
Definitions:
Legal Interest Rate
The maximum rate of interest that lenders can legally charge borrowers, often set by law or regulation.
Economic Profits
Profits that exceed the opportunity costs of all resources used by a firm, including both explicit and implicit costs.
Accounting Profits
The financial gain calculated by subtracting total explicit costs from total revenue, as recorded in the financial statements.
Explicit Costs
Costs that involve direct monetary payment by a business to purchase or maintain resources.
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