Which of the following is TRUE of the price charged by a monopolistically competitive firm at the profit-maximizing level of output?
A. P > MC
B. P < AVC
C. P = MC
D. P = MR
Answer: A
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The marginal value that a consumer places on the last unit can be read off of the
a. demand curve. b. supply curve. c. contract curve. d. production possibility curve.
A cost that arises from the production of a good that is paid by someone who did not participate in the production is called
A) a free rider. B) an externality. C) rent seeking. D) a public failure.
Explain two ways by which the Federal Reserve System can increase the monetary base. Why is the effect of Federal Reserve actions on bank reserves less exact than the effect on the monetary base?
What will be an ideal response?
Refer to Figure 3.2, which shows David's and Celeste's individual supply curves for flower arrangements per week. Assuming David and Celeste are the only producers in the market, if the market quantity supplied is 350, the price must be:
A. $10. B. $20. C. $30. D. $40.