Referring to the diagram for a monopolistically competitive firm in short-run equilibrium. this firm's profit-maximizing price will be $160.
The economic market model is one of monopolistic competition, where numerous vendors offer comparable but distinct goods. Although the firms are offering differentiated items, many of them are still close substitutes. As little more than a result, if one firm increases its price too much, many of its consumers will migrate to products made by other firms. This makes the demand curve of monopolistic competition elastic. Demand elasticity like this is comparable to perfect competition.
Short-Run Profit = (Price - ATC) × Quantity
Referring to the diagram for a monopolistically competitive firm in short-run equilibrium. this firm's profit-maximizing price will be $160.
The figure given below:
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