A Monopolistic-Competitive Firm in a Market Before Trade Opens
(Figure 6.2)

To maximize pure profits, a monopolistically competitive firm such as this should produce and sell all units for which the extra (or marginal) revenue from selling the unit exceeds the extra (or marginal) cost of producing the unit. Therefore, the firm will choose to produce where marginal revenue equals marginal cost. Press "Show MC=MR" to show the profit maximization point and profit maximizing level of output on the graph. The monopolistically competitive firm will charge what the market will bear. Press "Show Price" to show the price the firm will charge at the profit maximizing quantity.
Press "Continue" when you are ready to move on. The "Reset" button will clear the graph.