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Suppose that a firm produces wool jackets in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal
Suppose that a firm produces wool jackets in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. PRICE (Dollars per jacket) 100 10 80 70 8 00 50 ATC 40 4P 30 20 10+ MC- 0 MR Demand 10 20 30 40 00 50 70 0 90 100 QUANTITY (Thousands of jackets) Mon Comp Outcome Min Unit Cost
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