monopolistically competitive markets, zero economic profit is associated with: saved 1 out of question Select one: O a. Inefficient output and excess capacity. O b. Competitive equilibrium because other firms entered the market. O c No deadweight loss O d. Efficient output and no excess capacity. Clear my choice Australian Institute of Business & Management

monopolistically competitive markets, zero economic profit is associated with: saved 1 out of question Select one: O a. Inefficient output and excess capacity. O b. Competitive equilibrium because other firms entered the market. O c No deadweight loss O d. Efficient output and no excess capacity. Clear my choice Australian Institute of Business & Management

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter10: Monopolistic Competition And Oligopoly

Section: Chapter Questions

Problem 4QFR

See similar textbooks

Similar questions

Continuing with the scenario in question 1, in the long run, the positive economic profits that the monopolistic competitor earns will attract a response either from existing firms in the industry or film outside. As those films capture the original films profit, what will happen to the original films profit-maximizing price and output levels?
Aside from advertising, how can monopolistically competitive films increase demand for their products?
For each of the following characteristics, saywhether it describes a perfectly competitive firm, amonopolistically competitive firm, both, or neither.a. sells a product differentiated from that of itscompetitorsb. has marginal revenue less than pricec. earns economic profit in the long rund. produces at the minimum of average total cost inthe long rune. equates marginal revenue and marginal costf. charges a price above marginal cost
You are hired as a consultant to a monopolisticallycompetitive firm. The firm reports the followinginformation about its price, marginal cost, andaverage total cost. Can the firm possibly bemaximizing profit? If not, what should it do toincrease profit? If the firm is maximizing profit, is themarket in a long-run equilibrium? If not, what willhappen to restore long-run equilibrium?a. P < MC, P > ATCb. P > MC, P < ATCc. P 5 MC, P > ATCd. P > MC, P 5 ATC
Critically evaluate and explain:a. In monopolistically competitive industries, economic profits are competed away in the long run; hence, there is no valid reason to criticize the performance and efficiency of such industries. b. In the long run, monopolistic competition leads to a monopolistic price but not to monopolistic profits.
1. If the firms in a monopolistically competitive marketare earning economic profits or losses in the short run,would you expect them to continue doing so in the longrun? Why? 2. Is a monopolistically competitive firmproductively efficient? Is it allocatively efficient? Whyor why not? 3. What stops oligopolists from acting together asa monopolist and earning the highest possible level ofprofits?
2. Is a monopolistically competitive firmproductively efficient? Is it allocatively efficient? Whyor why not? 3. What stops oligopolists from acting together asa monopolist and earning the highest possible level ofprofits?
True / False4. Advertising must be socially wasteful because advertising simply adds to the cost of producing a product.5. In the long run, firms in monopolistically competitive markets produce at the minimum of their average total cost curves.
(Monopolistic Competition and Perfect Competition Compared)Illustrated below are the marginal cost and averagetotal cost curves for a small firm that is in long-runequilibrium.a. Locate the long-run equilibrium price and quantity ifthe firm is perfectly competitive.b. Label the price and quantity p1 and q1.c. Draw in a demand and marginal revenue curve to illustratelong-run equilibrium if the firm is monopolisticallycompetitive. Label the price and quantity p2 and q2 .d. How do the monopolistically competitive firm’s priceand output compare to those of the perfectly competitivefirm?e. How do long-run profits compare for the two types offirms?
(28). A firm that faces a high-demand period followed by a low-demand period must determine all of the following for peak-load pricing except which one? O A) long-term peak quantity O B) long-run capacity O C) short-term peak price O D) short-term off-peak price (29) The demand for Healthy Bars, a health snack bar, is Qd = 10 - (2 x P) and Healthy Bars has a constant average cost of $3 per snack bar. If Healthy Bars wants to package their bars to create an all-or-nothing offer and puts the profit-maximizing number of bars into each package, what is the profit-maximizing price to charge for the package? O A) $8 O B) $20 O C) $12 O D) $16
Question #5What is the MC=MR Profit Maximization point? What quantity should Delicious Deserts be producing at 'and' what price should they be charging to maximize their profits? Question #6 Why isn't it a good idea for them to produce and sell as many cakes as they can? Is it more profitable to sell less cakes at this current stage of their business? Question #7Do you have any other recommendations for Delicious Deserts to increase their revenues, profits, market share, and client retention?
Macmillan Learning In monopolistic competition, advertising has been introduced as a new method to compete that differs from other markets. The following questions are centered around the topic of advertising. What two changes occur when a firm successfully advertises a product within the market? Supply for the product increases and demand becomes more elastic Demand for the product increases and demand become more inelastic O Demand for the product increases and demand becomes more elastic O Demand for the product decreases and demand becomes more inelastic What is the firm's main goal of advertising? Increase the elasticity of its demand curve Move the market closer to its natural, perfectly competitive state Increase product differentiation O Increase the supply of product in the market Which of the following would be arguments against advertising? ✔Provides a barrier to entry in the market ✔Lowers prices of some products May enhance enjoyment of the product Can lead to increased…