A fast-food restaurant decides to raise the price of its hamburgers. Assume the firm is in a monopolistically competitive industry. What will happen to the its hamburgers? When the fast-food restaurant raises the price of hamburgers, O A. all of its customers will be willing to pay the higher price because this restaurant is close to them. B. some of its customers will be willing to pay a higher price because they prefer this brand of hamburgers. c. all of its customers will be willing to pay the higher price because this restaurant faces no competition. D. none of its customers will be willing to pay the higher price because this restaurant faces competition from other restaurants. O E. none of its customers will be willing to pay the higher price and will stop buying hamburgers.
A fast-food restaurant decides to raise the price of its hamburgers. Assume the firm is in a monopolistically competitive industry. What will happen to the its hamburgers? When the fast-food restaurant raises the price of hamburgers, O A. all of its customers will be willing to pay the higher price because this restaurant is close to them. B. some of its customers will be willing to pay a higher price because they prefer this brand of hamburgers. c. all of its customers will be willing to pay the higher price because this restaurant faces no competition. D. none of its customers will be willing to pay the higher price because this restaurant faces competition from other restaurants. O E. none of its customers will be willing to pay the higher price and will stop buying hamburgers.
Chapter10: Monopolistic Competition And Oligopoly
Section: Chapter Questions
Problem 1.1P
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Transcribed Image Text:A fast-food restaurant decides to raise the price of its hamburgers. Assume the firm is in a monopolistically competitive industry. What will happen to the demand for
its hamburgers?
When the fast-food restaurant raises the price of hamburgers,
A. all of its customers will be willing to pay the higher price because this restaurant is close to them.
B. some of its customers will be willing to pay a higher price because they prefer this brand of hamburgers.
c. all of its customers will be willing to pay the higher price because this restaurant faces no competition.
D. none of its customers will be willing to pay the higher price because this restaurant faces competition from other restaurants.
E. none of its customers will be willing to pay the higher price and will stop buying hamburgers.
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