-Use the Above Figure

question 68

Multiple Choice

-Use the above figure. For this monopolistic competitor, which of the following is INCORRECT?

• A) The profit-maximizing rate of output is qe, and the profit-maximizing price is P.
• B) The demand curve shows a direct relationship between price and quantity demanded.
• C) The profit-maximizing rate of output is at E, where MR intersects MC.
• D) A downward sloping marginal revenue curve that is below the demand curve.

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