The theory of monopolistic competition predicts that in long-run equilibrium a monopolistically competitive firm will:
a. produce the output level at which price equals long-run marginal cost.
b. operate at minimum long-run average cost.
c. overutilize its insufficient capacity.
d. produce the output level at which price equals long-run average cost.
Ans: d. produce the output level at which price equals long-run average cost.
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A) raises; increases B) raises; decreases C) lowers; increases D) lowers; decreases
The ______ the demand curve, the _____ responsive is the amount demanded to price.
A. steeper; less B. steeper; more C. flatter; less D. higher; less
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A. theorems. B. objectives. C. building blocks. D. precepts.
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