Bafb1023
Microeconomics
Topic 7
Market Structure (Monopolistic Competition) With Explained
Answers 100% Correct Download To Score A
BAFB1023
MICROECONOMICS
TOPIC 7
MARKET STRUCTURE (MONOPOLISTIC COMPETITION)
Question 1
Figure 1
Consider the monopolistically competitive firm whose demand curve and cost structure are
, Bafb1023
Microeconomics
Topic 7
Market Structure (Monopolistic Competition) With Explained
Answers 100% Correct Download To Score A
illustrated in Figure 1.
a) What is the profit-maximizing quantity?
Profit is maximized at the quantity of output where marginal revenue equals marginal
cost therefor, Q is MR = MC as that figure 1 shows above the profit maximizing
quantity is 100 units of output per week.
b) Calculate the total revenue.
The profit maximized quantity is 100 and the price of the demand will be $16 whereby,
Total Revenue = Price x Quantity, so the total revenue is $1,600.
$16 X 100 Unit = $1,600
Microeconomics
Topic 7
Market Structure (Monopolistic Competition) With Explained
Answers 100% Correct Download To Score A
BAFB1023
MICROECONOMICS
TOPIC 7
MARKET STRUCTURE (MONOPOLISTIC COMPETITION)
Question 1
Figure 1
Consider the monopolistically competitive firm whose demand curve and cost structure are
, Bafb1023
Microeconomics
Topic 7
Market Structure (Monopolistic Competition) With Explained
Answers 100% Correct Download To Score A
illustrated in Figure 1.
a) What is the profit-maximizing quantity?
Profit is maximized at the quantity of output where marginal revenue equals marginal
cost therefor, Q is MR = MC as that figure 1 shows above the profit maximizing
quantity is 100 units of output per week.
b) Calculate the total revenue.
The profit maximized quantity is 100 and the price of the demand will be $16 whereby,
Total Revenue = Price x Quantity, so the total revenue is $1,600.
$16 X 100 Unit = $1,600
