Product differentiation forms the basic rationale for advertising expenditures by monopolistically competitive firms
Indicate whether the statement is true or false
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The Roomba 570 is a robotic vacuum cleaner made and sold by iRobot. It can vacuum 4 rooms on a single battery charge and it costs $2 worth of electricity to charge the Roomba
Lynn is a house cleaner and can vacuum 4 rooms in 1 hour with a traditional vacuum. Suppose you want the 4 rooms in your house vacuumed once a week for one year. Ignoring the cost of any electricity Lynn uses, which method is economically efficient if Lynn charges $20 per hour? $30 per hour? A) Roomba if Lynn charges $20 per hour and Lynn if she charges $30 per hour B) Lynn if she charges $20 or $30 per hour C) Roomba if Lynn charges $20 or $30 per hour D) Lynn if she charges $20 per hour and Roomba if Lynn charges $30 per hour
The demand curve facing a perfectly competitive firm is
A) the same as the market demand curve. B) downward-sloping and less flat than the market demand curve. C) downward-sloping and more flat than the market demand curve. D) perfectly horizontal. E) perfectly vertical.
In the long run in a perfectly competitive market:
A. firms earn zero economic profits. B. firms operate at an efficient scale. C. supply is perfectly elastic when all firms have the same cost structure. D. All of these are true.
Which of the following market structures describes an industry in which a group of firms formally agree to control prices and output of a product?
a. Perfect competition. b. Monopoly. c. Oligopoly. d. Cartel. e. Monopolistic competition.