Figure 16-4
-Refer to Figure 16-4. The firm in this figure is monopolistically competitive. This firm
A)is operating in the long run.
B)is earning a short-run economic profit.
C)is incurring a short-run loss.
D)The answer cannot be determined from the information given.

Question

Figure 16-4 
-Refer to Figure 16-4. The firm in this figure is monopolistically competitive. This firm
A)is operating in the long run. 
B)is earning a short-run economic profit. 
C)is incurring a short-run loss. 
D)The answer cannot be determined from the information given.

Quizplus · Accepted Answer

In monopolistic competition, a firm earns a short-run economic profit if its price is above average total cost (ATC) at the profit-maximizing quantity.

Figure 16-4 -Refer to Figure 16-4. the Firm in This Figure Is