When new firms enter a monopolistically competitive industry:
a. the average total cost curves of established firms will shift downward
b. the demand curve of an established firm is reduced at each level of output.
c. the established firms will each increase production.
d. the average revenue received by an established firm will increase at each level of output.
b
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Firms in perfect competition produce the productively efficient output level in the short run and in the long run
Indicate whether the statement is true or false
If the government undertakes expansionary fiscal policy, it might:
A. increase income taxes. B. decrease income taxes. C. decrease government spending. D. increase corporate income taxes.
Unless otherwise specified, because it is what people and businesses use in their day-to- day market transactions, when referring to money, economists are talking about
a. M1 b. M2 c. M3 d. credit cards e. liquidity
Say you are the owner of a Pizza place. You know that when you produce 10 pizzas, the average product of each of your workers is 10, and the marginal product of your last worker is 15. From this information you know that
A. the average product is increasing. B. the average product is decreasing. C. the marginal product is decreasing. D. the marginal product is increasing.