The graph below shows the monopolistically competitive market for smart phones. Price ($) 320 Tools --O 280 PLA 240 NEL 10 20 30 40 50 60 70 80% Smart phones (millions) 0 10 20 30 40 50 60 70 80 90 Smartphones (millions) Instructions: Using the tool provided (Pt. A), plot the profit maximizing quantity and price on the graph. a. This producer is earning positive profits in the short run b. In the long run, (Click to select) will increase and economic profits will Click to select for this producer The marginal costs (MC), average variable costs (AVC), and average total costs (ATC) for a firm are shown in the figure below. Instructions: Use the tool provided (Pt. A) to identify the profit-maximizing output. Then use the tool "Profit" to draw the area of profit (or loss) that occurs at this level of output. Position this rectangle by dragging on the vertices. Price/Cost (5) AVC 10 20 30 40 500 G B nts Quantity eBook Print ferences Instructions: Round your answer to the nearest whole number. At the profit-maximizing level of output, average total cost is and profit is
