Which of the following will happen if some firms in a monopolistically competitive market incur losses in the short run and the market conditions are not expected to change?
A) The existing firms will continue production in the long run.
B) The demand for the goods produced by the firms will decrease.
C) New firms will enter the industry in the long run.
D) Some firms will exit the industry in the long run.
D
You might also like to view...
Which of the following is LEAST likely to be a monopoly?
A) the holder of a public franchise B) a pharmaceutical company with a patent on a drug C) a store in a large shopping mall D) an artist who owns a copyright for a painting
When the government controls the price of a product, causing the market price to be above the free market equilibrium price,
A) all producers gain. B) both producers and consumers gain. C) only consumers gain. D) some, but not all, sellers can find buyers for their goods.
Annual budgeting of production goals of a division within a firm
a. is an accounting mechanism to plan for the costs and revenues over a time period b. increase the burden on the division when goals rise c. can lead to accumulated inventory when the goals of an upstream division are arbitrarily set too high d. all of the above
Which of the following statements is true of a monopolist?
a. It can raise price without losing sales, since there are no competitors. b. At a given price, it can sell all of the output that it can produce. c. It is able to choose a price & output combination to the right of its demand schedule. d. At a given price it can sell only one particular output level.