Problem
Suppose that a firm in monopolistic competition faces a demand curve p = 10/X2 and cost curve C = 50 + 30X. What is the mark-up of price on average cost? Suppose that the demand curve now shifts out, so p = 20/X2. What happens to the mark-up?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.