Sally's Smoothie Bar operates in a monopolistically competitive market with a downwardsloping demand curve. Marginal cost is increasing with the quantity of smoothies supplied. At its current level of output, Sally knows the following information: MC $4 ATC $5 AVC $2.5 MR $4 Price $10 Which of the following is correct? Group of answer choices At the current level of output, both ATC and AVC are decreasing with increasing output The firm should increase its output to maximize its profits. It would be willing to operate in the short run, but not in the long run. The firm should continue operating at the current level of output to maximize its profits. The firm would be willing to operate both in the short run and in the long run. Both (a) and (c)