Author Question: In the above figure, when this monopolistically competitive firm produces its profit-maximizing ... (Read 145 times)

Tazate · **on:** Jun 29, 2018

In the above figure, when this monopolistically competitive firm produces its profit-maximizing output, it sets a per-unit price of

A) 13.
B) 11.
C) 10.
D) 8.

Question 2

Under rate-of-return regulation, average cost pricing

A) is inflated so the firm can make economic profits.
B) includes variable costs but not a cost for capital.
C) includes what they consider to be a fair rate of return on investment.
D) includes a cost for capital that generates an above normal rate of return.