A Monopolistically Competitive Firm Faces the Following Demand Curve for Its

question 488

Multiple Choice

A monopolistically competitive firm faces the following demand curve for its product: The firm has total fixed costs of $120 and a constant marginal cost of $12 per unit. We can conclude that

• A) firms will exit this market.
• B) firms will enter this market.
• C) this market is in long-run equilibrium.
• D) this firm is operating at its efficient scale.

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Definitions:

Strengths

Positive attributes of an organization. These are internal resources and capabilities that support a company to achieve its mission, goals, and competitive advantage.

Weaknesses

Areas where a business or product lacks strength or is less competitive compared to others in the market.

Opportunities

Potential situations in the market that, when leveraged, can lead to the growth and success of a business.

Threats

External challenges or dangers that could potentially harm the operation, objectives, or survival of an organization or system.