Monopolistic Competition is different from Perfect Competition because of:

Related Mcqs:

1. Monopolistic competition differs from perfect competition primarily because ?

   A. in monopolistic competition entry into the industry is blocked B. in monopolistic competition there are relatively few barriers to entry. C. in monopolistic competition, firms can differentiate their products D. in perfect competition firms can differentiate their products...

2. The long-run equilibrium outcomes in monopolistic competition and perfect competition are similar because in both market structures ?

   A. the efficient output level will be produced in the long run B. firms will only earn a normal profit C. firms realize all economies of scale D. firms will be producing at minimum average cost...

3. The use of word “competition” in the name of the market structure called “monopolistic competition” refers to the fact that ?

   A. there are many sellers in a monopolistically competitive market and there is free entry and exit in the market just like a competitive market B. Monopolistically competitive firms face a downward-sloping demand curve just like competitive firms. C. Monopolistically competitive firms charge prices equal to the minimum of their average total cost just like...

4. Which of the following statements best describes the outcome under monopolistic competition ?

   A. In monopolistic competition, there are too many firms and each firm produce a slightly different product at a scale that is less than optimal B. In monopolistic competition there are too few firms and each firm produce a slightly different product at scale that is greater than optimal C. in monopolistic competition there is...

5. In monopolistic competition firms achieve some degree of market power ?

   A. by producing differentiated products B. because of barriers to exit from the industry C. by virtue of size alone D. because of barriers to entry into the industry...

6. Which of the following is true regarding the similarities and differences in monopolistic competition and monopoly ?

   A. the monopolist faces a downward-sloping demand curve while the monopolistic competitor faces an elastic demand curve B. the monopolist charges a price above marginal cost while the monopolistic competitor charges a price equal to marginal cost C. The monopolist makes economic profits in the long run while the monopolistic competitor makes zero economic profits...

7. One source of inefficiency in monopolistic competition is that since price is above marginal cost, some units are not produced that buyers value in ?

   A. Since price is above marginal cost surplus is redistributed from buyers to sellers B. monopolistically competitive firms earn economic profits in the long run C. monopolistically competitive firms produce beyond their efficient scale D. excess of the cost of production and this causes a deadweight loss....

8. In monopolistic competition ?

   A. Firms face a perfectly elastic demand curve B. All products are homogeneous C. Firms make normal profits in the long run D. There are barriers to entry to prevent entry...

9. In monopolistic competition ?

   A. Demand is perfectly elastic B. Products are homogeneous C. Marginal revenue = price D. The marginal revenue is below the demand curve and diverges...

10. In monopolistic competition of firms are making abnormal profit other firms will enter and ?

    A. The marginal cost will shift outwards B. the demand curve will shift inwards C. The average cost will shift downwards D. The average variable cost will increase...