The saying that "You cannot have your cake and eat it too" illustrates the economic concept of

Explain why a monopolistically competitive firm would not want to reduce its price all the way to its minimum average total cost even though doing so would allow it to increase sales?

What will be an ideal response?

Since the demand curve faced by a monopolistically competitive firm is downward sloping,

a. the firm is a price-taker in the short run b. in the long run there will be excess capacity c. the output decisions of one firm will influence profits of all other firms d. the product in the market is viewed by consumers as being standardized e. the ATC curve is U-shaped