A profit-maximizing, monopolistically competitive restaurant serves 60 burgers a day at a total cost of $180 and earns a total profit of $180. In the long run, everything else equal, the
A. restaurant will charge more than $6 per burger.
B. restaurant’s average total cost will rise and its total revenue will fall.
C. restaurant will sell more burgers at a lower average profit per burger.
D. All of the responses are correct.
Answer: B
Economics
You might also like to view...
Refer to the scenario above. What is the payoff to Firm A in equilibrium?
A) $2.4 million B) $2.6 million C) $5.2 million D) $3.0 million
Economics
In a world of scarcity, there has to be some way to ration the available resources. According to economists, the most efficient use of available resources occurs when rationing occurs via
A) queuing. B) lotteries. C) political power. D) the price system.
Economics