Answer:
The correct answer is option b.
Explanation:
A monopolistic competition is a market structure where there is a large number of firms selling heterogeneous products which are close substitutes.
A monopolistic firm faces a downward-sloping curve and is able to maximize its profit where the marginal revenue is equal to marginal cost.
The monopolistic firm will increase its production if the marginal revenue is more than marginal cost. The firm will not be maximizing profit at this.
To increase profits, the firm will increase production to the point where the marginal revenue is equal to marginal cost.
