Monopolies can ________ in the long run while monopolistically competitive firms ________ due to barriers to entry in monopoly but not in monopolistic competition.
A. can never shut down; can
B. break even; cannot
C. earn positive economic profits; cannot
D. only break even; can only earn positive economic profits
Answer: C
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Consumers in a monopolistically competitive market do not receive any consumer surplus because the price paid for the product exceeds the marginal cost of production
Indicate whether the statement is true or false
R&D lab organization The key assets of Prescott Pharmaceuticals are its capable R&D scientists who generate and evaluate countless new chemical compounds for possible product profitability. They had structured their various laboratories based on the
diseases and patient classes the new drugs would treat, e.g., skin cancer, COPD, Irritable Bowel Syndrome. Recently, the scientific discoveries have made biologicals, or "large molecules," a much more promising avenue of treatment. However, the skills required to synthesize, produce, and evaluate biologicals are represented by more narrow and distinct fields of study. Scientists benefit greatly from sharing knowledge gained within their own field but they have few skills that span across these fields. How does this change affect Prescott's organization of its scientists?
Antitrust enforcement of vertical relationships is generally focused on
a. The dominant firm using vertical contracts to extend market power to other levels of the supply chain b. Vertical contracts that increase the intensity of competition c. Vertical contracts that help consumers d. All of the above
When determining equilibrium using supply and demand, the concept of ceteris paribus is used. The term ceteris paribus means:
a. other things being equal. b. allowing things to change. c. other things being different. d. time and space considered.