Can anyone explain this graphically? I am looking at my monopolistic competition graph, and i dont understand how the greater the product differentiaion increases exces capacity. I mean, greater product differentiation means an increase in demand in MR(correct me if im wrong). With this shift in the demand and MR curve, how does that increase the distance from the quantity the firm produces at, and the min. ATC point?
2007-12-11
17:34:58
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2 answers
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asked by
DJ4LIFE
2
in
Economics