Question

	Under which market structure can the firms make more than normal profit?
	pure competition and monopolistic competition oligopoly and monopoly monopolistic competition and oligopoly pure competition and monopoly

	Suppose that there are three firms in an industry, and their market shares are respectively 10%, 30%, and, and 60%. Then the Herfindahl index for this industry is:
	1,000 3,400 3,600 4,600

	Under which market structure is the non-price competition common?
	Monopolistic competition and oligopoly Oligopoly and monopoly Pure competition and monopolistic competition Pure competition and monopoly

Answer 1

Under oligopoly and monopoly can the firms make more than normal profit. The firms in perfect competition and monopolistic competition in the long run earn only normal profits but can make economic profits in the short run.

The market shares are respectively 10%, 30%, and, and 60%, then the Herfindahl index for this industry is (10^2+30^2+60^2) =4600

Under the markets, Monopolistic competition and oligopoly the non-price competition is common.