Suppose that a typical firm in a monopolistically competitive industry faces a demand curve given...

Question

Suppose that a typical firm in a monopolistically competitive industry faces a demand curve given by:
q = XXXXXXXXXX/2)p, where q is quantity sold per week.
The firm’s marginal cost curve is given by: MC = 60.

How much will the firm produce in the short run?
What price will it charge?

Robert · Accepted Answer

QUESTION: 
Suppose that a typical firm in a monopolistically competitive industry faces a 
demand curve given by     q = 60 - (1/2) P, where q is quantity sold per week. 
The firm’s marginal cost curve is given by: MC = 60. 
1. How much will the firm produce in the short run? 
2. What price will it charge?
SOLUTION: 
The inverse demand function can be written as           :

Suppose that a typical firm in a monopolistically competitive industry faces a demand curve given by: q = XXXXXXXXXX/2)p, where q is quantity sold per week. The firm’s marginal cost curve is given by:...

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