Author Question: Which of the following is ALWAYS true regarding a profit maximizing monopolistically competitive ... (Read 67 times)

future617RT

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Which of the following is ALWAYS true regarding a profit maximizing monopolistically competitive firm in short-run equilibrium?
 
  A) P = ATC.
  B) P = MR.
  C) MR = MC.
  D) MC = ATC.

Question 2

The ABC Nail Company has entered into a collusive agreement with the other firm in the industry, the DC Nail Company. What occurs in the nail industry if ABC decides to cheat on the agreement?
 
  A) ABC lowers the price of its nails.
  B) The total industry output increases.
  C) The total profits in the nail industry will decrease.
  D) All of the above answers are correct.



ong527

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Answer to Question 1

C

Answer to Question 2

D



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