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If a Monopolistically Competitive Firm Can Increase Its Level of Production

Question 367

Multiple Choice

If a monopolistically competitive firm can increase its level of production and lower its average total cost of production at the same time then


A) the firm has a product-variety opportunity.
B) the firm has excess capacity.
C) the firm has a business-stealing opportunity.
D) the firm is producing a quantity of output higher than its efficient scale of production.

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