This preview shows pages 1–3. Sign up to view the full content.
This preview has intentionally blurred sections. Sign up to view the full version.View Full Document
Unformatted text preview: Features: There are many firms producing a slightly differentiated product. Firms have some market power in that they face a downward sloping demand curve. There is free entry and exit from the industry. A monopolistically competitive firm will earn no economic profit in the long run. Firms dont produce at the minimum point of the long run ATC curve, they allow some excess capacity. Q $ MC ATC AVC = D AR = MR...
View Full Document
This note was uploaded on 04/13/2008 for the course ECON 101 taught by Professor Brentkreider during the Summer '07 term at Iowa State.
- Summer '07