A monopolistically competitive firm faces the inverse demand curve P = 100 – Q, and its...

A monopolistically competitive firm faces the inverse demand curve P = 100 – Q, and its
marginal cost is constant at $20. The firm is in long-run equilibrium.
a. Graph the firm's demand curve, marginal revenue curve, and marginal cost curve. Also, identify the profitmaximizing
price and quantity on your graph.
b. What is the value of the firm's fixed costs?
c. What is the equation for the firm's ATC curve?
d. Add the ATC curve to your graph in part a.

Expert Solution

Rahul Sunny answered 2 years ago

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