What is the most important difference between perfectly competitive markets and monopolistically competitive markets?
What will be an ideal response?
In both perfectly competitive and monopolistically competitive industries there are many firms and low barriers to entry. However, while products are identical in perfectly competitive markets, products are similar—but not identical—in monopolistically competitive markets.
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In economic analysis, any amount of profit earned above zero is considered "above normal" because
A) normally firms are supposed to earn zero profit. B) this would indicate that the firm's revenue exceeded both its accounting and opportunity cost. C) this would indicate that the firm was at least earning a profit equal to its opportunity cost. D) this would indicate that the firm's revenue exceeded its accounting cost.
A change in the price of a good will shift the indifference curves
a. True b. False Indicate whether the statement is true or false
A depreciation of the dollar relative to another currency will raise U.S. exports, lower U.S. imports, and raise U.S. net exports
Indicate whether the statement is true or false
An improvement in a firm's technology that improves productivity results in a(n):
A. leftward shift of the supply curve. B. upward movement along the supply curve. C. willingness to supply a larger quantity than before at any given price. D. downward movement along the supply curve.