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Suppose you are the manager of a firm that operates in a monopolistically competitive industry. The market demand function facing your firm is QD =
Suppose you are the manager of a firm that operates in a monopolistically competitive industry. The market demand function facing your firm is QD P and your firms cost function is CQQ Q
a Find the inverse demand function for your firms product.
b Determine the profitmaximizing price and level of production.
c Calculate your firms maximum profits.
d What longrun adjustments should your firm expect? Explain.
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