Homework Answers
30) Answer is D
In monopolistically competitive market if firms are making short term losses then some firm will exit the market in the long run which will reduce supply in the market and therefore price for the product will increase. This process will continue untill economic profir becomes 0 in the long run.
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Question 60 5 pts If there are five firms in an industry with equal market shares,...
1l. If a monopolistically competitive firm is incurring losses, then at the profit-max a price is above the average total cost curve. b. price is below the average total cost curve c. price is equal...
1l. If a monopolistically competitive firm is incurring losses, then at the profit-max a price is above the average total cost curve. b. price is below the average total cost curve c. price is equal to marginal revenue. d. price is less than marginal revenue. e. average total cost equals marginal cost. Both competitive and monopolistically competitive firms a. can maximize profit by raising price. b. cannot control or set their own price c. can maximize profit by producing to...
16. If firms in a monopolistically competitive market are earning positive profits, then a. firms will likely be su...
16. If firms in a monopolistically competitive market are earning positive profits, then a. firms will likely be subject to regulation. b. barriers to entry will be strengthened. c. some firms will exit the market. d. new firms will enter the market. 17. As new firms enter a monopolistically competitive market, profits of existing firms a. rise, and product diversity in the market decreases. b. decline, and product diversity in the market increases. c. rise, and product diversity in the...
QUESTION 1 Which of the following is not a characteristic of the monopolistic competition market structure?...
QUESTION 1 Which of the following is not a characteristic of the monopolistic competition market structure? Many sellers, each small in size relative to the overall market. Few sellers. Differentiated product. Easy, low-cost entry and exit. QUESTION 2 Which of the following is the best example of a monopolistic competitor? Wheat farmers. Restaurants. Air Canada. General Motors. QUESTION 3 In the long run, both monopolistic competition and perfect competition result in: a wide variety of brand-name choices for consumers. an...
FICE 150 firms in the monopolistically competitive industry. Price is above marginal revenue, as a general...
FICE 150 firms in the monopolistically competitive industry. Price is above marginal revenue, as a general rule, regardless of the number firms in the monopolistically competitive industry. At low levels of output, price is above marginal revenue. At high levels of ou price is below marginal revenue as long as the number of firms is not too ma because if it is too large, the monopolistically competitive industry will beco perfectly competitive. Question 13 (1 point) If monopolistically competitive forms...
1. A cartel is a group of firms that attempts to a. maximize joint revenue. b....
1. A cartel is a group of firms that attempts to a. maximize joint revenue. b. increase competition. c. behave independently. d. maximize joint profit. 2. If a firm's product loses brand loyalty, then the demand curve will: a. Become less price elastic. b. Shift to the right. c. Become more price elastic. d. Shift to the left. 3. Assume a monopoly confronts the same costs and demand as a competitive industry. In this case, the monopolist produces: a. Less...
Question 7 5 pts If the typical form in a perfectly competitive market is currently earning...
Question 7 5 pts If the typical form in a perfectly competitive market is currently earning a 5% economic pront, what will happen in this market in the long run? O new firms will enter until the economic profits have disappeared. firms will exit until the economic profit reaches 10% firms will neither enter norexit, since 5% economic profit is enough to maintain the existing number of firms in the market. It depends on the rate of normal profit in...
If firms in a monopol istically competitive industry are experiencing economic losses in the short run,...
If firms in a monopol istically competitive industry are experiencing economic losses in the short run, the industry some firms will demand until each firm earns a normal profit exit; increasing exit; reducing enter; increasing enter; reducing In an oligopoly, all the firms: compete over price alone. take their competitors into account when they make pricing decisions. Ocompete over advertising. face easy entry and exit from the market.
Question 7 5 pts Let's say that you know the following information for an oligopoly firm:...
Question 7 5 pts Let's say that you know the following information for an oligopoly firm: Total Revenue equals $200 million. Variable Costs are $170 million. Fixed Costs equal $20 million. The firm is currently producing 2,000 products at the MC = MR point (and the MC curve is rising). What recommendation do you have for this firm? Assuming the firm's costs remain the same, the firm should produce fewer products in order to decrease its marginal costs. The profit...
Which of the following is TRUE of market failures? Externalities and public goods are examples of...
Which of the following is TRUE of market failures? Externalities and public goods are examples of market failure. O All of the answers given are true of market failures. O When our resources are not allocated efficiently by the market, then we have market failure. Markets characterized by monopolies, oligopolies and monopolistic competition are examples of market failure. Statement 1: If left to itself, the market will produce too little of a good if there are positive externalities. Statement 2:...
If the donut industry is perfectly competitive and is in long-run equilibrium, then the price of...
If the donut industry is perfectly competitive and is in long-run equilibrium, then the price of a donut Question 20 options: A) equals long-run average cost. B) is greater than marginal cost. C) is greater than long-run average cost. D) is greater than short-run average cost. The industry that produces zangs is in long-run equilibrium. Then the demand for zangs increases permanently. As a result, firms in the industry will ________. Some firms will ________ the industry, and the industry...
1l. If a monopolistically competitive firm is incurring losses, then at the profit-max a price is above the average total cost curve. b. price is below the average total cost curve c. price is equal to marginal revenue. d. price is less than marginal revenue. e. average total cost equals marginal cost. Both competitive and monopolistically competitive firms a. can maximize profit by raising price. b. cannot control or set their own price c. can maximize profit by producing to...
16. If firms in a monopolistically competitive market are earning positive profits, then a. firms will likely be subject to regulation. b. barriers to entry will be strengthened. c. some firms will exit the market. d. new firms will enter the market. 17. As new firms enter a monopolistically competitive market, profits of existing firms a. rise, and product diversity in the market decreases. b. decline, and product diversity in the market increases. c. rise, and product diversity in the...
FICE 150 firms in the monopolistically competitive industry. Price is above marginal revenue, as a general rule, regardless of the number firms in the monopolistically competitive industry. At low levels of output, price is above marginal revenue. At high levels of ou price is below marginal revenue as long as the number of firms is not too ma because if it is too large, the monopolistically competitive industry will beco perfectly competitive. Question 13 (1 point) If monopolistically competitive forms...
Question 7 5 pts If the typical form in a perfectly competitive market is currently earning a 5% economic pront, what will happen in this market in the long run? O new firms will enter until the economic profits have disappeared. firms will exit until the economic profit reaches 10% firms will neither enter norexit, since 5% economic profit is enough to maintain the existing number of firms in the market. It depends on the rate of normal profit in...
If firms in a monopol istically competitive industry are experiencing economic losses in the short run, the industry some firms will demand until each firm earns a normal profit exit; increasing exit; reducing enter; increasing enter; reducing In an oligopoly, all the firms: compete over price alone. take their competitors into account when they make pricing decisions. Ocompete over advertising. face easy entry and exit from the market.
Question 7 5 pts Let's say that you know the following information for an oligopoly firm: Total Revenue equals $200 million. Variable Costs are $170 million. Fixed Costs equal $20 million. The firm is currently producing 2,000 products at the MC = MR point (and the MC curve is rising). What recommendation do you have for this firm? Assuming the firm's costs remain the same, the firm should produce fewer products in order to decrease its marginal costs. The profit...
Which of the following is TRUE of market failures? Externalities and public goods are examples of market failure. O All of the answers given are true of market failures. O When our resources are not allocated efficiently by the market, then we have market failure. Markets characterized by monopolies, oligopolies and monopolistic competition are examples of market failure. Statement 1: If left to itself, the market will produce too little of a good if there are positive externalities. Statement 2:...
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