Discussion Post Unit 5 - PSYC 1580.docx - In a monopolistic...

This preview shows page 1 out of 1 page.

In a monopolistic competitive industry, The prices of all products can be easily predicted as firms set the price based on the demand curve. According to Rittenberg & Tregarthen (2009) "The firm produces an output where the marginal revenue equals the marginal cost, and then they set its price according to the demand curve". If the demand curve = average curve in a monopolistic competitive firm, We will use the following steps: q = 60 – (1/2) P (1/2)P = (60 – q) ...(moved the right-hand side value to left and right-hand side Price related values to left) P = (120 – 2q) ...(multiplied by 2 on both sides to get rid of the left side.) Now, let's get the MR.

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture