Show and explain why profits go to zero in the long run under monopolistic competition. Hint: Sta...
QUESTION 7 Monopolistic competitive firms in the long run earn: positive economic profits. zero pure economic profits. negative economic profits. Positive, zero, or negative economic profits. QUESTION 8 Which of the following statements best describes firms under monopolistic competition? Profits will be positive in the long run. Price always equals average variable cost. In the long run, positive economic profit will be eliminated. Marginal revenue equals minimum average total cost in the short run. QUESTION 9 Which of the following...
In perfect competition as well as in monopolistic competition, a. profit is positive in a long-run equilibrium for each firm. b.entry and exit by firms are restricted. c. there are many firms in a single market. d. marginal revenue is equal to price for each firm. ECTION 22 Monopolistic competition differs from perfect competition because in monopolistically competitive markets a. all firms can eventually earn economic profits. b. each of the sellers offers a somewhat different product. C. strategic interactions...
QUESTION 14 Outline the main assumptions of monopolistic competition. Explain, with the graphs, the short run and long run equilibrium conditions of a monopolistic competitive firm (10 marks) QUESTION 15 At what price and output will a monopolist firm maximise profits and how much profit will it make? Explain with graph (10 marks) (10 marks) QUESTION 16 What conditions must hold for price discrimination to be possible? In each of the cases below, why and how does a firm choose...
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...
1. What is "monopolistic" about monopolistic competition? What is "competitive" about monopolistic competition? Please explain. 2. Can a monopolistically competitive firm earn large positive profits in the long run? Please explain.
Long-run equilibrium in monopolistic competition is characterized by which of the following? (There may be more than one correct answer.) a. Excess capacity b. Monopoly profits as a result of collusion c. Zero profits d. More profits than under perfect competition but less than under monopoly e. P = MC
Use the MR/MC approach and the appropriate graph to show the profit maximizing price and quantity for a firm in monopolistic competition. Assume that the firm is making economic profits in the short-run. Explain what happens to the economic profits in the long-run.
In the diagram below, identify the demand curve consistent with a monopolistic competitor making zero long - run economic profit. Explain why you have chosen that demand curve and why the other two demand curves are not consistent with monopolistic competition.
2) Why is the firm’s demand curve flatter than the total market demand curve in monopolistic competition? Suppose a monopolistically competitive firm is making a profit in the short run. What will happen to its demand curve in long run equilibrium ? What could this firm do to affect what happens to its demand curve? Explain in detail.
Which market structure can earn long-run economic profits? a. Perfect competition b. Monopolistic competition c. Oligopoly d. Monopoly e. c and d only All firms produce where a. marginal benefits are greater than marginal profits b. short-run profits are less than long-run profits c. marginal revenues are greater than or equal to marginal costs d. average total costs are greater than marginal costs A perfect competitor is a __________ and can earn economic profits ____________. a. price maker, in both...