Problem
You are a producer in a monopolistically competitive market of a good that is seen as being critical in the fight against the coronavirus (use hand sanitizer as an example), assume prior to the virus outbreak you had been producing a quantity that equated MR to MC and thereby allowed you to optimize your profitability. Further assume the price you are authorized to sell the product for has now been frozen by government order, and you have been mandated by government order to increase the quantity of the product you must produce to service the spike in market demand. Explain what you believe will happen to the profitability of this firm including in your answer what will happen to MC as your output expands and to your MR as price is forced to remain constant.