The key characteristics of a monopolistically competitive industry? are:
?[A] A large number of firms that sell differentiated products that are close substitutes.
?[B] Firms can easily enter or exit a monopolistically competitive industry.
?[C] Because monopolistically competitive firms can increase their profits if they can successfully distinguish their products from those of their? rivals, they have an incentive to engage in sales promotions and advertising.
?Answer: [A] A large number of firms that sell differentiated products that are close substitutes.
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Which of the following defines monopolization?
A) the Securities and Exchange Commission B) the Federal Reserve C) U.S. Supreme Court D) Federal Trade Commission Act
The new classical view of fiscal policy holds that
a. budget deficits will stimulate consumption. b. budget deficits will decrease the saving rate. c. individuals fail to recognize that debt-financing implies higher future taxes. d. individuals fully anticipate the added tax liability implied by the debt financing and will increase their saving so they can meet this obligation.
Whenever average total cost exceeds marginal cost,
a. average total cost is rising. b. average total cost is falling. c. marginal cost is rising. d. marginal cost is falling.
A potential cause of competitive market failure is symmetric information.
Answer the following statement true (T) or false (F)