(Exhibit: Profit Maximization for a Firm in Monopolistic Competition) Suppose that an innovation reduces a firm's fixed costs and reduces cost from ATC to ATC'. Suppose further that after the innovation reduced the cost to ATC', it costs a total of $18 per unit to produce 170 units per day. If the firm charges a price equal to marginal cost, total net profit will be: a. $1,190. b. $3,400. c. $1,700. d . $3,060.
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Reference: Ref 11-2
(Exhibit: Profit Maximization for a Firm in
a. $1,190.
b. $3,400.
c. $1,700.
d
. $3,060.
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