Question 8 of 21 Map Sapling Learning macmilan learning A Profit-Maximizing Mono

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Question 8 of 21 Map Sapling Learning macmilan learning A Profit-Maximizing Monopolistic Competitor 45 The graph to the right shows the costs revenue, and demand facing a monopolistically competitive firm 35 30 25 Average Cost Price (S) 15 Refer to the graph to answer the three multiple choice questions below Demand Marginal Revenue 100 20 30 80 90 110 Quantity The area covered by the rectangle CDEF is the firm's: The area covered by the rectangle ABD C is the firm's The area covered by the rectangle ABEFis the firm's O total cost O total revenue O profit O none of the above O total cost O total cost O total revenue O profit O none of the above total revenue O profit none of the above Previous ? Give Up & View Solution Check Answer Next Exit Hint

Explanation / Answer

1.

The area CDEF is the total cost=ATC*Q

Hence option first is the correct answer.

Option first; total cost.

2.

The area covered by the rectangle ABDC is= profit

Profit=(Price -AC)Q

Hence option third is the correct answer.

Option third: profit

3

The area covered by the rectangle ABEF is =total revenue

Total revenue= price*quantity

Hence option second is the correct answer.

Hence option second; total revenue.

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