Price d a e b c 0 Q1 Q2 Quantity Q3 g S f D
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The graph shows a typical supply and demand curve with the equilibrium point at Q2, where the supply curve (S) intersects the demand curve (D) at point c. Show more…
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Suppose for some firm that average total cost is minimized at q1 units of output. for a monopolistically competitive firm in long-run equilibrium, q1 a. exceeds the level of output at which there is a point of tangency between the demand curve and the average total cost curve. b. exceeds the level of output at which marginal revenue equals marginal cost. c. is also the level of output at which marginal cost equals average total cost. d. all of the above are correct.
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6. The optimal level of output may be defined as that level of output where a. average benefit exceeds average cost by the greatest amount. b. total benefit equals total cost. c. marginal benefit exceeds marginal cost by the greatest amount. d. the marginal benefit of the last unit purchased equals its marginal cost. e. it is impossible to define optimal in any meaningful way.
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