The following equations represent a firm in a monopolistically competitive market. Demand: Qd= 32 - P...

The following equations represent a firm in a monopolistically competitive market.

Demand: Qd= 32 - P

Marginal revenue: MR = 32 -2Q

Total Cost: TC = 100 + Q^2

Marginal Cost: MC=2Q

1. Will this firm in a monopolistically competitive market continue to earn these profits in the long run? Briefly explain why or why not.

2. Sketch (no need for the sketch to be to scale) a graph that includes that includes the following curves in the appropriate relation to each other: - the firms demand curve - the firms marginal revenue curve - the firms marginal cost curve - the firms average total cost curve (Label the profit maximizing price, quantity produced, and area of profits if non-zero.)

Expert Solution

Rahul Sunny answered 2 years ago

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