ECON 260 Figure 4 1000 900 800 700 600 500 400 300 200 100 MR 5 10 15 20 25 30 3
ID: 1114623 • Letter: E
Question
ECON 260 Figure 4 1000 900 800 700 600 500 400 300 200 100 MR 5 10 15 20 25 30 35 40 Quantity 34 Refer to Figure#4. This figure depicts a situation in a monopolistically competitive market In short run, what price will the monopolistically competitive firm charge in this market? a. $300. b. $400. c. $300. d. $600. 35. Refer to Figure 4. At the profit-maximizing, or loss-minimizing, output level, the firm in this figure has total costs of approximately a. $2,000. b.$3,000 c. $4,000. d. $5,000 36. Refer to Figure #4. Assume the firm in the figure is currently producing 8 units of output and charging $400. The firm a. will increase its profits if it raises its price and reduces its production level. b. will increase its profits if it lowers its price and expands its production level. c. is maximizing profits d. will increase its profits if it raises its prices and expands its production level. 37. Which of the following best describes the idea of excess capacity in monopolistic competition? a. Firms produce more output than is socially desirable b. Due to product differentiation, firms choose output levels where P>ATC. c. Firms keep some surplus output on hand in case there is a shift in the demand for their product. d. The output produced by a typical firm is less than what would occur at the minimum point on its ATC curve 38 Refer to Figure#5 This figure depicts a situation in a monopolistically competitive market. How much consumer surplus will be derived from the purchase of this product at the monopolistically competitive price? a. $200.00. b. $312.50. c$400.00. d. $800.00 39. Refer to Figure 5. This figure depicts a sinuation in a monopolistically competitive market. How much profit will the monopolistically competitive firm earn in this situation? a. A S10 profit b. A $20 profit c. A S200 profit. d. No profit, since monopolistically competitive firms never earn economic profit. Figure#5:Explanation / Answer
34) 600 because firm produces at a point where MR=MC and Q=10 and P=600
35)total cost=AC*Q=500*10=5000
36)D. Raise the price with the production capacity
37)D. Output is less than the output which is min of ATC
38)fig 5 not given
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.