The complexity in the ability of the firms to engage in nonprice competition under the monopolistic competition market structure is attributed to:
A.) the assumption of a given product and a given level of advertising expenditure.
B.)the assumption of a given price and quality of the product.
C.)the assumption of a given marginal revenue.
D.) the assumption of a given number of competitors.
The complexity in the ability of the firms to engage in nonprice competition under the monopolistic competition market structure is attributed to:
A.) the assumption of a given product and a given level of advertising expenditure.
B.)the assumption of a given price and quality of the product.
C.)the assumption of a given marginal revenue.
D.) the assumption of a given number of competitors.
Related textbook solutions
Related questions
21)
Compared to the results in a perfectly competitive market, a monopoly does which of the following?
| Ā |
It charges a higher price. |
| Ā |
It charges a price greater than the marginal cost. |
| Ā |
It produces less output. |
| Ā |
All of the above |
| Ā |
None of the above |
22)
"X-inefficiency"Ā refers to the idea that
| Ā |
government restrictions on competition create a monopoly, which results in inefficiency. |
| Ā |
the cost of rent-seeking activity should be added to the welfare cost of monopoly. |
| Ā |
Generation X is less efficient due to a lack of competitive spirit. |
| Ā |
a lack of competitive pressure results in a monopoly not keeping its costs down to the lowest possible level. |
| Ā |
price discrimination results in inefficiently low cross-elasticities of demand. |
23)
Firms in which of the following market structures can engage in price discrimination?
| Ā |
monopoly |
| Ā |
oligopoly |
| Ā |
monopolistic competition |
| Ā |
All of the above |
| Ā |
None of the above |
24)
Monopolistic competition and perfect competition are in all of the following ways except
| Ā |
Barriers to entry are low in both |
| Ā |
There are many firms in both |
| Ā |
Firms in both produce the output level where MR=MC |
| Ā |
Nonprice competition is important in both |
25)
To get rid of excess capacity from the monopolistic competition in the long run, what would have to be given up?
| Ā |
Free entry and exit. |
| Ā |
economic rent |
| Ā |
resource allocative efficiency |
| Ā |
differentiated product |
| Ā |
productive efficiency |
