The long-run profit-maximizing equilibrium of a firm in monopolistic competition in many ways is similar as...

The long-run profit-maximizing equilibrium of a firm in monopolistic competition in many ways is similar as well as different from both under monopoly and that for a firm in a perfectly competitive market. Using three separate diagrams, articulate the differences and similarities (demand conditions, cost conditions and level of profits).

Expert Solution

Rahul Sunny answered 1 year ago

When a profit-maximizing firm in monopolistic competition is producing its long-run equilibrium quantity, A) it will...

When a profit-maximizing firm in monopolistic competition is producing its long-run equilibrium quantity, A) it will be earning economic profit. B) its price will equal its marginal cost. C) its price will be equal to its average total cost. D) its marginal revenue will exceed its marginal cost.

When a profit-maximizing firm in a monopolistic competitive market is in long-run equilibrium, marginal cost is...

When a profit-maximizing firm in a monopolistic competitive market is in long-run equilibrium, marginal cost is rising since an increase in production would increase average total cost. true or false The product-variety externality associated with monopolistic competition arises because in markets that are monopolistic competitive markets, firms try to differentiate their products. true or false If the monopolistic competitive firm is currently producing output at a level where the marginal cost curve intersects the demand curve, then it is producing...

A profit-maximizing firm in monopolistic competition should shut down in the short run if: a. price...

A profit-maximizing firm in monopolistic competition should shut down in the short run if: a. price is more than average total cost. b. price is less than average variable cost. c. marginal revenue is equal to marginal cost. d. marginal revenue is less than price. e. price is less than average fixed cost. The term “strategy” in terms of game theory refers to: a. the tendency for collusive firms to generate normal profits. b. each firm’s decision to charge a...

1. In monopolistic competition, the long-run equilibrium results in zero economic profit of the firms in...

1. In monopolistic competition, the long-run equilibrium results in zero economic profit of the firms in these industries. The key factor in this is a. differentiated products. b. freedom of entry into and exit from the industry. c. price discrimination. d. brand names. 2. In the long run, a monopolistically competitive industry is characterized by all of the following, except a. an efficient use of resources. b. production that would exhibit lower costs per...

In long-run equilibrium for both a competitive market and monopolistic competition accounting profit is zero. price...

In long-run equilibrium for both a competitive market and monopolistic competition accounting profit is zero. price equals marginal revenue. long-run average cost is minimized. economic profit is zero.* productive efficiency is achieved.

What happens in the long run for the monopolistic competition firm and for the oligopoly firm?...

What happens in the long run for the monopolistic competition firm and for the oligopoly firm? Which of the two are better for the consumer and why?

1.Discuss the profit maximizing position of a monopolistic, in both the short run and the long...

1.Discuss the profit maximizing position of a monopolistic, in both the short run and the long run

A. Compare and contrast profit maximizing conditions under monopoly and monopolistic competition in the short-run. B....

A. Compare and contrast profit maximizing conditions under monopoly and monopolistic competition in the short-run. B. Compare and contrast profit maximizing conditions under perfect competition and monopolistic competition in the long-run.

Explain the differences between perfect competition and monopolistic competition. b. Explain the long run equilibrium for...

Explain the differences between perfect competition and monopolistic competition. b. Explain the long run equilibrium for a monopolistically competitive firm that is earning economic profits in the short run.( use diagram to support answer)

What makes a business successful in monopolistic competition? Provide a short-run profit graph and long-run profit...

What makes a business successful in monopolistic competition? Provide a short-run profit graph and long-run profit graph.

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