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The graph below shows demand curve and cost data for a firm operating in a monopolistic competition.

What quantity will this firm set in order to maximize profits (or minimize losses)?

 

Hint


The graph below shows demand curve and cost data for a firm operating in a monopolistic competition.

What price will this firm set in order to maximize profits (or minimize losses)?

If you cannot see ATC curve it is because the costs are so high they don't fit the graph.

 

Hint


The graph below shows demand curve and cost data for a firm operating in a monopolistic competition.

What will happen in this market in the long run?

Hint: If you cannot see ATC curve it is because the costs are so high they don't fit the graph.

 

Hint