If a monopolistically competitive firm can earn a profit, it will increase production until:

A price support leads to inefficiency because

A) output is more than the efficient, equilibrium quantity. B) the marginal benefit of the last unit produced is larger than the marginal cost. C) the price charged is less than the equilibrium price. D) producer surplus is less than consumer surplus. E) producers must pay a subsidy to the government.

Suppose an economy experiences an increase in inflation. Explain the possible macroeconomic benefits of this increase in inflation

What will be an ideal response?