Refer to the above graph.Assume that in long-run equilibrium a purely competitive firm has the same cost curves as that of the monopolistically competitive firm shown.It can be concluded that the:
A) purely competitive firm would have lower profits.
B) purely competitive firm would have higher profits.
C) purely competitive producer would produce less at a higher ATC.
D) monopolistically competitive producer would produce less at a higher ATC.

Question

Refer to the above graph.Assume that in long-run equilibrium a purely competitive firm has the same cost curves as that of the monopolistically competitive firm shown.It can be concluded that the:
A) purely competitive firm would have lower profits. 
B) purely competitive firm would have higher profits. 
C) purely competitive producer would produce less at a higher ATC. 
D) monopolistically competitive producer would produce less at a higher ATC.

Quizplus · Accepted Answer

The Answer of  Refer to the above graph.Assume that in long-run equilibrium a purely competitive firm has the same cost curves as that of the monopolistically competitive firm shown.It can be concluded that the:
A) purely competitive firm would have lower profits. 
B) purely competitive firm would have higher profits. 
C) purely competitive producer would produce less at a higher ATC. 
D) monopolistically competitive producer would produce less at a higher ATC.

Refer to the Above Graph