Table 16-4 This table shows the demand schedule, marginal cost, and average tota

Question

Table 16-4 This table shows the demand schedule, marginal cost, and average total cost for a monopolistically competitive firm.

A) Which of the following is likely to happen in the long run in this market?

D. The market price is likely to rise.

B) If the government forces this firm to produce at its efficient output level, how much output will this firm produce?

C) Refer to Table 16-4. If the government forces this firm to produce at its efficient output level, how much profit will this firm earn?

D) How much profit will this firm earn when it chooses its output to maximize profit?

Quantity Price Marginal Cost Average Total Cost   0 $50 -- --   1 $45 $30 $40   2 $40 $24 $32   3 $35 $14 $26   4 $30 $10 $22   5 $25 $12 $20   6 $20 $32 $22   7 $15 $50 $26   8 $10 $74 $32   9   $5 $104 $40 10   $0 $140 $50

Explanation / Answer

Ans)

#

B. Firms are likely to enter the market since firms are earning a positive economic profit.

#

A firm will produce where P=MC so it will produce at 5 units

#

#

A. 5 units of output

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.