Author Question: A monopolistically competitive firm is making a positive economic profit. In the long run, which of ... (Read 118 times)

bobypop · **on:** Jun 29, 2018

A monopolistically competitive firm is making a positive economic profit. In the long run, which of the following is most likely?

A) It will produce less output and it will charge a lower price.
B) It will produce the same output and charge the same price.
C) It will produce less output but keep price the same.
D) It will keep output the same but will charge a higher price.

Question 2

The indifference curves in the figure above (I1, I2, and I3 ) reflect Peter's consumption preferences.

If Peter consumes 24 slices of pizza and 24 chocolate bars per month, he as satisfied as he would be consuming ________ slices of pizza and ________ chocolate bars per month. A) 48; 12
B) 40; 20
C) 32; 8
D) 16; 16