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30-11-2022
Business

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(Figure 67-5: Profit Maximization in Monopolistic Competition) In panel B, the profit-maximizing price is P, and the ATC curve is tangent to the new demand curve. The portion of the ATC that lies to the right of the tangency and continues down to the intersection of MC with ATC indicates: (Critical thinking) a. that the firm is experiencing an economic loss, b. that the firm is earning an economic profit. c. overutilization d. excess capacity. e deadweight loss

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