QUESTION 5 Which firm makes zero economic profit in the long run? a. Only a perfectly competitive firm. O b. Only a monopolist firm. O.A perfectly competitive and a monopolistically competitive firm. O d. All the firms such as a perfectly competitive, a monopolist, and a monopolistically competitive firm. QUESTION 6 In a perfectly competitive market if the number of units sold increases but the price per unit stays the same then the a. total revenue will increase. b. total revenue will decrease. c. total revenue will stay the same. d. total revenue can go either way depending on the demand.

QUESTION 5 Which firm makes zero economic profit in the long run? a. Only a perfectly competitive firm. O b. Only a monopolist firm. O.A perfectly competitive and a monopolistically competitive firm. O d. All the firms such as a perfectly competitive, a monopolist, and a monopolistically competitive firm. QUESTION 6 In a perfectly competitive market if the number of units sold increases but the price per unit stays the same then the a. total revenue will increase. b. total revenue will decrease. c. total revenue will stay the same. d. total revenue can go either way depending on the demand.

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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Similar questions

Aside from advertising, how can monopolistically competitive films increase demand for their products?
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?
Suppose the local electrical utility, a legal monopoly based on economies of scale, was split into four films of equal size, with the idea that eliminating the monopoly would promote competitive pricing of electricity. What do you anticipate would happen to prices?
What is the relationship between product differentiation and monopolistic competition?
Is a monopolistically competitive firm productively efficient? Is it allocatively efficient? Why or why not?
Draw a monopolists demand curve, marginal revenue, and marginal cost curves. Identify the monopolists profit-maximizing output level. Now, think about a slightly higher level of output (sayQ0+1). According to the graph, is there any consumer willing to pay more than the marginal cost of that new level of output? If so, what does this mean?
If the firms in a monopolistically competitive market are earning economic profits or losses in the short run, would you expect them to continue doing so in the long run? Why?
Would you rather have efficiency or variety? That is, one opportunity cost of the variety of products we have is that each product costs more per unit than if there were only one kind of product of a given type, like shoes. Perhaps a better question is, What is the right amount of variety? Can there be too many varieties of shoes, for example?
Imagine a monopolist could charge a different price to every customer based on how much he or she were willing to pay. How would this affect monopoly profits?
How is the perceived demand curve for a monopolistically competitive film different from the perceived demand curve for a monopoly or a perfectly competitive film?
What is predatory pricing? How might it reduce competition, and why might it be difficult to tell when it should be illegal?
K The following figure shows the revenue curves of a monopolist: Figure 11.6 5000 Price ($) 4000- 2500- 0 D. Average revenue MR: Marginal revenue O $500,000 200 O $300,000 O $350,000 O $250,000 In Figure 11.6, assume that marginal costs are constant at $2,500 and fixed costs are 0. What would be the amount of consumer surplus if the market was perfectly competitive? 400 O $1,000,000 MR Quantity 102°F Sunny