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2.1 In the short run, monopolistically competitive firms: a) charge a price equal to marginal cost. b) typically earn a negative economic profit. c) sell a product that is completely unique. d) behave similarly to a monopoly. 2.2 In the long run, monopolistically competitive firms: a) tend to earn zero economic profit due to entry of new firms. b) tend to earn positive profit due to barriers to entry. c) tend to earn negative profit because consumers prefer different products as incomes rise. d) tend to produce at minimum ATC. 2.3 Monopolistically competitive markets are: a) Less efficient than pure monopoly and pure competition. b) Less efficient than pure monopoly and more efficient than pure competition. c) More efficient than pure monopoly and less efficient than pure competition. d) More efficient than pure monopoly and pure competition. 2.4 Which of the following is NOT a characteristic of a monopolistically competitive market? a) Many firms b) Firms are price-setters c) Firms engage in advertising d) Tough barriers to entry

2.1 In the short run, monopolistically competitive firms: a) charge a price equal to marginal cost. b) typically earn a negative economic profit. c) sell a product that is completely unique. d) behave similarly to a monopoly. 2.2 In the long run, monopolistically competitive firms: a) tend to earn zero economic profit due to entry of new firms. b) tend to earn positive profit due to barriers to entry. c) tend to earn negative profit because consumers prefer different products as incomes rise. d) tend to produce at minimum ATC. 2.3 Monopolistically competitive markets are: a) Less efficient than pure monopoly and pure competition. b) Less efficient than pure monopoly and more efficient than pure competition. c) More efficient than pure monopoly and less efficient than pure competition. d) More efficient than pure monopoly and pure competition. 2.4 Which of the following is NOT a characteristic of a monopolistically competitive market? a) Many firms b) Firms are price-setters c) Firms engage in advertising d) Tough barriers to entry

Microeconomics A Contemporary Intro
Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter10: Monopolistic Competition And Oligopoly
Section: Chapter Questions
Problem 4QFR
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2.1 In the short run, monopolistically competitive firms: a) charge a price equal to marginal cost. b) typically earn a negative economic profit. c) sell a product that is completely unique. d) behave similarly to a monopoly. 2.2 In the long run, monopolistically competitive firms: a) tend to earn zero economic profit due to entry of new firms. b) tend to earn positive profit due to barriers to entry. c) tend to earn negative profit because consumers prefer different products as incomes rise. d) tend to produce at minimum ATC. 2.3 Monopolistically competitive markets are: a) Less efficient than pure monopoly and pure competition. b) Less efficient than pure monopoly and more efficient than pure competition. c) More efficient than pure monopoly and less efficient than pure competition. d) More efficient than pure monopoly and pure competition. 2.4 Which of the following is NOT a characteristic of a monopolistically competitive market? a) Many firms b) Firms are price-setters c) Firms engage in advertising d) Tough barriers to entry 2.5 Which of the following goods is most likely to belong a monopolistically competitive market? a) Timber b) Microwave ovens c) A newly patented pharmaceutical pill d) Large passenger aircraft 2.6 Which of the following industries is most likely to be an oligopoly? a) Timber b) Microwave ovens c) A newly patented pharmaceutical pill d) Large passenger aircraft
Transcribed Image Text:2.1 In the short run, monopolistically competitive firms: a) charge a price equal to marginal cost. b) typically earn a negative economic profit. c) sell a product that is completely unique. d) behave similarly to a monopoly. 2.2 In the long run, monopolistically competitive firms: a) tend to earn zero economic profit due to entry of new firms. b) tend to earn positive profit due to barriers to entry. c) tend to earn negative profit because consumers prefer different products as incomes rise. d) tend to produce at minimum ATC. 2.3 Monopolistically competitive markets are: a) Less efficient than pure monopoly and pure competition. b) Less efficient than pure monopoly and more efficient than pure competition. c) More efficient than pure monopoly and less efficient than pure competition. d) More efficient than pure monopoly and pure competition. 2.4 Which of the following is NOT a characteristic of a monopolistically competitive market? a) Many firms b) Firms are price-setters c) Firms engage in advertising d) Tough barriers to entry 2.5 Which of the following goods is most likely to belong a monopolistically competitive market? a) Timber b) Microwave ovens c) A newly patented pharmaceutical pill d) Large passenger aircraft 2.6 Which of the following industries is most likely to be an oligopoly? a) Timber b) Microwave ovens c) A newly patented pharmaceutical pill d) Large passenger aircraft
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