A monopolistically competitive firm has the following demand and total cost curves: Demand: P= 9 -0.25Q TC=

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A monopolistically competitive firm has the following demand and total cost curves:

Demand: P= 9 -0.25Q

TC= 124 -16Q + Q²

a. Find the price and quantity that maximizes profits for the monopolistically competitive firm

b. How much profits does the monopolistically competitive firm make at the profit-maximizing level of quantity?

c. Explain the following: What adjustments do you expect to happen in the market in the long-run? What will happen to the demand curve of the firm (will it increase/decrease)? How much profits do you expect the firm to earn in the long run?

Related Book For answer-question

Air Transport Economics

ISBN: 9781032482538

4th Edition

Authors: Bijan Vasigh, Brian Pearce

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Posted Date: Feb 23, 2024 05:07 AM

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A monopolistically competitive firm has the following demand and total cost curves: Demand: P= 9 -0.25Q TC=

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a To find the price and quantity that maximizes profits for the monopolistically competitive firm we ... View the full answer

Air Transport Economics

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