Week 4 Homework ECON 200 1) The figure below shows the cost structure for a monopolistically competitive firm. Price ($) AC MC $60 50 40 28 D I 0 28 40 45 Quantity a) What quantity will this firm produce and what price will it charge to maximize profits? b) What will be the amount of profit or loss at the profit-maximizing level of production? c) What is likely to happen in the long run? Is there likely to be a substantial amount of new entry into this industry? Explain