QUESTION 7 The graph below summarizes the demand and costs for a firm that operates under a monopolistically competitive market. Instruction: Use the nearest whole numbers on the graph when calculating numerical responses below. $ 220 MC 200 - 180 - 160 - ATC 140 - 120- 100 - 80 - 60 40 - 20- MR 2 4 8 10 12 14 16 18 20 22 24 26 Quantity a. What level of output should this firm produce in the short run? units. b. What price should this firm charge in the short run?P = $ c. What is the firm's total cost at this level of output? TC = d. What is the firm's profit if it produces this level of output? Profits = $ g. What adjustments should the manager be anticipating? (А, В, С, or D). A. Demand will remain unchanged over time. B. Demand will decrease over time as new firms enter the market. C. Demand will increase over time as firms exit the market. D. Demand will increase over time a new firms enter the market.

QUESTION 7 The graph below summarizes the demand and costs for a firm that operates under a monopolistically competitive market. Instruction: Use the nearest whole numbers on the graph when calculating numerical responses below. $ 220 MC 200 - 180 - 160 - ATC 140 - 120- 100 - 80 - 60 40 - 20- MR 2 4 8 10 12 14 16 18 20 22 24 26 Quantity a. What level of output should this firm produce in the short run? units. b. What price should this firm charge in the short run?P = $ c. What is the firm's total cost at this level of output? TC = d. What is the firm's profit if it produces this level of output? Profits = $ g. What adjustments should the manager be anticipating? (А, В, С, or D). A. Demand will remain unchanged over time. B. Demand will decrease over time as new firms enter the market. C. Demand will increase over time as firms exit the market. D. Demand will increase over time a new firms enter the market.

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter16: Monopolistic Competition

Section: Chapter Questions

Problem 8PA

See similar textbooks

Similar questions

Below is a graphical illustration of a typical firm operating in a monopolistically competitive industry. ATC 01 Refer to the graph above to answer this question. What area graphically represents a profit-maximizing firm's total revenue? Select one: O a. OP,GQ;- O b. OP, HQs. O c OP,IQ, O d. OPJQ O e. OP,FQ.
QUESTION 7 The graph below summarizes the demand and costs for a firm that operates under a monopolistically competitive market. Instruction: Use the nearest whole numbers on the graph when calculating numerical responses below. $ 220 MC 200 - 180 - 160 - ATC 140 - 120- 100 - 80 - 60 40 - 20- MR 2 4 8 10 12 14 16 18 20 22 24 26 Quantity a. What level of output should this firm produce in the short run? units. b. What price should this firm charge in the short run?P = $ c. What is the firm's total cost at this level of output? TC = d. What is the firm's profit if it produces this level of output? Profits = $ g. What adjustments should the manager be anticipating? (А, В, С, or D). A. Demand will remain unchanged over time. B. Demand will decrease over time as new firms enter the market. C. Demand will increase over time as firms exit the market. D. Demand will increase over time a new firms enter the market.
Consider the following market for Tim's Terrible T-shirts a firm company producing in the monopolistically competitive t-shirt market. $7 $6 $5 $3 $2 $1 0 Question 16 10 20 30 Question 17 MR 40 Quantity MC D 50 60 70 80 At his profit maximizing output, what is the total profit earned by Tim? Should Tim want to maximize his profit in the short-run, how many t-shirts will he produce? ATC Describe what we expect to happen to Tim's terrible t-shirts in the long run. Since Tim is making |Select] to participate in the market. As a result, the demand for Tim's shirts should Select] Please answer all parts of question correctly. will give thumbs up if correct ✓economic profit in the short-run, as he transitions to the long run we would expect [Select | and become (Select]
Question 21 Markup Ос What is the level of profit for the monopolistically competitive firm in the above diagram? positive zero negative impossible to determine MC ATC
O Macmillan Learning The accompanying graph depicts the long-run costs and revenue for a monopolistically competitive firm. The numbers in parentheses show the output level and the cost, respectively, associated with various points. Place point A at the profit maximizing price and quantity. 800 750 700 MC ATC (11,600) 650 600 (3,550) 550 What is the profit-maximizing output of this monopolistically competitive firm? Cost and Revenue ($) 500 450 (5,425) $400 (8, 400) 350 (7,340) 300 250 Units of Output 200 (5, 200) 150 100 50 MR What is the level of excess capacity for this monopolistically competitive firm? 0 0 1 2 3 4 5 6 7 8 Units of Output Units of Output (11,500) 9 10 11 12 13 14 15
4. Maria manages a bakery that specializes in ciabatta bread (monopolistically competitive firm), and she has the following information on the bakery’s demand and costs: Ciabatta Bread Sold per Hour (Q) 0 1 2 3 4 5 6 7 8 Price (P) $6.00 5.50 5.00 4.50 4.00 3.50 3.00 2.50 2.00 Total Cost (TC) $3.00 7.00 10.00 12.50 14.50 16.00 17.00 18.50 21.00 a. To maximize profit, how many loaves of ciabatta bread should Maria sell per hour, what price should she charge, and how much profit will she make? b. What is the marginal revenue Maria receives from selling the profit-maximizing quantity of ciabatta bread? What is the marginal cost of producing the profit- maximizing quantity of ciabatta bread?
1. Consider the following graph: Price (dollars per cup) $6.00 MC ATC 3.50 Profit 2.50 Demand 0 1 2 3 45 6 7 8 9 10 Quantity (cafe lattes per week) Profit-maximizing quantity of caté lattes MR a) Is it possible to say whether this firm is a perfectly competitive firm or a monopolistically competitive firm.
Fill in the missing data for this Monopolistically Competitive firm. Don't forget to answer the questions below the chart. I. Average Total Marginal Total Marginal Total Total Quantity Price Revenue Revenue Cost Cost Cost Profit 50 na na -50 1 48 75 2 46 45 37 4 31 135 25 15 32 38 7 175 253 /////// 8. 144 311 9 90 379 /////I/ 10 459 This firm's fixed costs are? Assuming no inflation, we would predict this firm's price to rise/fall/ stay the same. Explain your answer.
The figure below shows the situation facing Smart Digit, Inc, a firm in monopolistic competition that produces calculators. What is the firm's economic profit per day? 20 16 MC ATC 12 MR 100 200 300 400 500 600 Quantity (calculators per day) 00 4. Price and costs (dollars per calculator)
c-State and explain briefly 2 differences between a perfectly competitive market and a monopolistic competitive market.
Σ B. 20 10 50 30 20 PRICE (Dollars per bat) Homework (C (91. 4. Is monopolistic competition efficient? Suppose that a firm produces baseball bats in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. 06 Mon Comp Outcome Min Unit CAst 09 40 10 MR Demand pleuwe 09 06 QUANTITY (Thousands of bats) Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that ▼ at the optimal eticall the miair MacBook Pro ACID & 5. R H N command comm
3. The accompanying graph (bottom of this page) summarizes the demand and costs for a firm that operates in a monopolistically competitive market. c. What are the firm's maximum profits? d. What adjustments should the manager be anticipating? $220 210 200 190 180 170 160 150 140 130 120 110 100 MC ATC 90 80 70 60 50 40 30 20 10 MR 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Quantity