Under monopolistic competition:
a. there are significant barriers to entry
b. there are few barriers to entry.
c. firms sell identical products.
d. firms face perfectly elastic demand curves.
b
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In a competitive market with high cost and low cost consumers (where firms are unable to tell consumer types apart), any screening costs incurred by firms will be passed on to low cost consumer but not to high cost consumers.
Answer the following statement true (T) or false (F)
Since 1950, the standard of living in the United States has:
A. decreased when measured by output per person, but increased when measured by total output. B. decreased when measured by both total output and output per person. C. increased when measured by output per person, but decreased when measured by total output. D. increased when measured by both total output and output per person.
Learning economies differ from economies of scale because
A. the former involves rising average costs and the latter involves falling average costs as a result of higher output levels. B. the former involves output in a single period of production and the latter involves cumulative output. C. the first is a short-run phenomenon and the second is a long-run phenomenon. D. the former involves cumulative production and the latter involves rate of production per period.
Refer to the table shown. If the market price is $8, a perfectly competitive profit-maximizing firm will produce:QuantityMarginal Cost1$3253749
A. 1 unit of output. B. 2 units of output. C. 3 units of output. D. 4 units of output.