A monopolistic competitor is similar to a monopolist in that: a. both earn positive economic profit...
A monopolistic competitor is similar to a monopolist in that:
a. both earn positive economic profit in the long run.
b. both have market power.
c. both produce the output at which long-run average cost is at a minimum.
d. All of these options are correct
Homework Answers
Answer
Option
b. both have market power.
===
Market power means the power to change price and both the firm faces a downward demand curve so can change a higher price at a lower quantity and vice verse.
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A monopolistic competitor is similar to a monopolist in
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