price is less than average cost in a monopolistically competitive market: A. there is no incentive for the number of firms in the market to change B. there is an incentive for firms to exit the market. C. the market must be in long-run equilibrium. D. there is profit incentive for firms to enter the market.
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If price is less than average cost in a
A. there is no incentive for the number of firms in the market to change
B. there is an incentive for firms to exit the market.
C. the market must be in long-run equilibrium.
D. there is profit incentive for firms to enter the market.
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- Which of these markets is most likely to be identified as monopolistic competition? Group of answer choices a. shoes b. corn c. gasoline d. shoes, corn and gasoline are all like monopolistic competitionQuestion 2 (i) A bicycle manufacturer expects the price of bicycle to rise in the near future, the supplier will ______________________. A: increase the supply of bicycle now B: decrease the supply of bicycle now C: decrease the quantity supplied of bicycle now D: increase the quantity supplied of bicycle now (ii) Red Mountain Coffee Company (RM) is a monopolistic competitive firm. At which of the following quantity should RM produce in order to maximize its profit? A: When marginal cost is equal to average revenue. B: When marginal cost is equal to marginal revenue. C: When the average total cost is equal to average revenue. D: When the average variable cost is equal to marginal revenue.Chipotle operates in monopolistic competition. When Chipotle first opened it was one of the only burrito places in the Buckland area of Manchester and made a profit. a. Draw a graph to illustrate this situation. b. Draw a second graph to show what happened in the long run.
- In the long run monopolistically competitive firms are inherently inefficient. do you agree? explainFortune Bakery sells cookies in a monopolistically competitive market. To maximize profit, what quantity should Fortune Bakery produce and what price should it charge? Suppose Fortune Bakery is in the long run equilibrium. Explain how much economic profit Fortune Bakery is making.The market for Banh Mi in Auckland CBD consists of 6 restaurants operating in monopolistic competition. Suppose that these firms face monthly fixed costs of $5,000 and marginal costs of $3. a) Draw the average cost and marginal cost curves for a representative firm. b) If the short run market price is $6 and each firm sells 2000 units per month, what will occur in the long run? Explain and show on a graph. c) Suppose that Banh Mi become more popular as a lunch option, and market demand increases. Explain the short run and long run effects on the market, including price, firm-level quantity and number of firms. Use graphs to explain your answer.
- a) Explain & depict the LongRun equilibrium for a monopolistically competitive firm. **Draw and upload graphs to depict the long-run\IV hat is true of a monopolistically competitive marketin long-run eqUilibrium?a. Price is greater than margi nal cost.b . Price is equal to marginal revenue.c. Firms make positive economic profits.d. Firms produce at the minimum of average total cost.What differentiates monopolistic competition from a monopoly?a A seller operating in a monopolistically competitive market no longar facet a downward-sloping demand curve,b. There are more seller,c. Firms can enter the market selling similar but not identical productd. (b) and (e)e. all of the above
- What differentiates monopolistic competition from a monopoly?a A seller operating in a monopolistically competitive market no longar facet a downward-sloping demand curve.b. There are more sellers.c. Firms can enter the market selling similar but not identical productd. (b) and (c)e. all of the aboveIf a monopolistically competitive industry is earning short-run positive economic profits, what do we expect to happen in the long run? a Existing firms will exit. b New firms will enter. c The industry will be regulated. d Firms will collude to keep prices high.Exercise A.7. If you were thinking about getting into the ice cream business, would you try to make an ice cream exactly like the (successful) brands that already exist? Explain your decision using the ideas about monopolistic competition