Refer to the above figure. Which of the following statements about panel D in the figure is TRUE?
A) The figure represents a long-run equilibrium for a monopolistic competitor.
B) The figure represents an industry long-run equilibrium for monopolistic competition.
C) The figure is in error since it doesn't show the monopolistic competitor making profits in the long run.
D) The figure is in error since it has marginal cost intersecting the ATC curve at a point other than the minimum of ATC.
D
You might also like to view...
Which of the following examples are substitutes in production?
a. shoes; polish b. 2 percent milk; cream c. baseballs; footballs d. crude oil; motor oil
Assume a simplified banking system subject to a 20 percent required reserve ratio. If there is an initial increase in excess reserves of $100,000, the money supply:
A. increases $100,000. B. increases $500,000. C. increases $600,000. D. decreases $500,000.
Every time we use scarce resources in one way, we give up the opportunity to use them in other ways.
Answer the following statement true (T) or false (F)
Horizontal merger occurs when
A. two firms merge where each is about the same size. B. two firms merge where one had sold its output to the other as an input. C. the merger moves the combined firm onto the horizontal portion of its long-run average cost curve. D. two firms producing a similar product merge.