1. We have the following information about a firm in a monopolistically competitive market: Price Quantity Total cost (dollars) (dollars) demanded 30 O 25 27 28 24 2 33 21 3 40 18 4 49 15 5 60 12 6 73 9 7 88 Calculate the firm's marginal revenue and marginal cost at each level of output (quantity demanded). How many units of output will the firm produce? What price will the firm charge? Will the firm earn any economic profits? Explain and show all your calculations. If the firm earns any profits, what will happen to the profits in the long run? Explain.Your Answer: Price Quantity Total Marginal Marginal Total cost (dollars) demanded Revenue cost Revenue 30 O 25 O 25 27 28 27 3 27 24 2 33 48 5 21 21 3 40 63 7 15 18 4 49 72 9 9 15 5 60 75 11 3 12 6 73 72 13 3 9 88 63 15 -9 Given, Q= 4 P= $18 TR= 72 TC= 49 Profit = 23 If the firm earns any profit, as in the long run more firms enter supplying a differentiated product , this will decrease the demand lowering the price which will lead to zero economic profits