A picture frame company operates in a monopolistically competitive market. Its short-run equilibrium price is $80 and its ATC is $65. It sells 100 picture frames a week. From this we can tell:
A. this firm is making a normal profit.
B. other picture frame companies will want to exit the market.
C. there are no other picture frame companies in the area.
D. economic profits are $1,500.
Answer: D
Economics
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The marginal revenue product is
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Economics