In the long run, the economic profits in a monopolistically competitive industry tend to go towards zero. The main reason for this is: a differentiated products. b diseconomies of scale. c increased regulatory pressure on profitable firms. d free entry.

In the long run, the economic profits in a monopolistically competitive industry tend to go towards zero. The main reason for this is: a differentiated products. b diseconomies of scale. c increased regulatory pressure on profitable firms. d free entry.

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter10: Monopolistic Competition And Oligoply

Section: Chapter Questions

Problem 2SQ

See similar textbooks

Related questions

Q: A photocopy shop in a monopolistically competitive market could daily sell 17,600 copies at a price…

A: A monopolistically competitive market refers to that structure of market where a large number of…

Q: Excess capacity is a. an example of the inefficiencies of monopolistically competitive markets.…

A: Excess capacity occurs when the firm produces lower level of output than its efficient level of…

Q: Monopolistically competitive firms use product differentiation to a.limit the number of firms in the…

A: In monopolistically competitive market, the sellers sell differentiated products which are close…

Q: One prediction about monopolistic competition as a market structure is that it has higher unit costs…

A: Monopolistic competition is the market where both market ( perfect competition and monopoly)…

Q: As firms leave a monopolistically competitive industry that is sustaining economic losses: choose…

A: Brand differentiation and monopolistic competition are inextricably linked. A monopolistic…

Q: A monopolistically competitive firm faces demand given by this equation: P = 50 – Q . It has no…

A: The topic of monopolistic competition and profit maximization for a firm operating in a…

Q: Figure 1 Price Quantity Quantity (c) (d) Price Price MC MC ATC ATC D XV MR Quantity Quantity 12.…

Q: Monopolistically competitive firms in a market face the following demand and costs, where P is…

A: Given; Demand function; Q=200N-P P=200N-QTotal Cost; TC=8+Q2

Q: All of the following are characteristics of long-run equilibrium for firms in a monopolistically…

A: A monopolistically competitive firm optimal output occurs at the intersection of MR and MC curves.…

Q: In monopolistically competitive markets, products are ____ and entry is ____. Select one: a.…

A: Basics:- In the monopolistic competitive market There are many firms There is free entry and exit…

Q: The figure shows the demand and cost curves for a firm in monopolistic competition. In the long run,…

A: A form of market structure where differentiated products are sold by a large number of sellers is…

Q: When firms in monopolistic competition are making an economic profit, firms will a.enter the…

A: In monopolistic competitive market, there are large number of firms selling differentiated goods…

Q: Unlike a monopolistic firmʹs product, a monopolistically competitive firmʹs product a.has no close…

A: Monopolistic competition characterizes an industry in which many firms offer products and services…

Q: If a monopolistically competitive industry is earning short-run positive economic profits, what do…

A: In a Monopolistically competitive market , Firms produces where MR = MC MR is the marginal revenue…

Q: A small, local restaurant in St. Augustine, FL, serves scrambled eggs for breakfast. The market for…

A: Here, the given graph provides information about a firm in monopolistically competitive market.…

Q: Which are the following are characteristics of a monopolistically competitive market? Price…

A: Monopolistic Competition:A monopolistic competition market is a one kind of market. It is neither a…

Q: Advertising by firms in monopolistic competition a. wastes resources because the entry of rivals…

A: Through advertisement every firm try to attracts the people and shows that their products has…

Q: Consider the diagram below depicting the revenue and cost conditions faced by a monopolistically…

Q: Draw the Demand, Marginal Revenue, Marginal Cost, and Average Total Cost curves for a…

A: The monopolistic competition includes numerous organizations contending with one another, yet…

Q: When monopolistically competitive firms earn ________ profits, other firms ________ the industry in…

A: Monopolistic firms are those firms which sell differentiated but closely related goods.

Q: In a monopolistic competition market structure it is likely that if a company is earning profits it…

A: A) in perfect competitive market:- 1) in perfect competitive market, there are many number of…

Q: Which of the following are features of monopolistic competition? Choose all that apply. a.…

A: There are different market structures, each with different characteristics. One such structure is…

Q: Which of the following is a characteristic of monopolistic competition? A. Many sellers with…

A: Monopolistic competition is a market structure that is an intriguing mix of both competition and…

Q: Is the outcome in a monopolistically competitive market desirable from the standpoint of society?…

A: A monopolistic competitive market is the one where firms provide differentiated goods which makes…

Q: In what way(s) is a monopolistically competitive firm inefficient? Group of answer choices It…

A: The question is asking about the inefficiencies that are associated with a monopolistically…

Q: How might a monopolistically competitive firm continually earn economic profit greater than zero?…

A: Monopolistic competition is such market structure where there are many buyers, many sellers.Product…

Q: Monopolistically competitive firms use product differentiation to Question 3Answer a. block other…

A: The objective of the question is to understand the reason why firms in a monopolistically…

Q: In the long run, the representative firm in monopolistic competition tends to have: Select one: a. a…

A: A monopolistic competitive market structure is characterised by a large number of large vendors,…

Q: Monopolistic competition is characterized by (Select all correct answers) □ A. Easy entry and exit…

A: There are different types of market structures on the basis of number of buyers and sellers, type of…

Q: In monopolistically competitive markets, zero economic profit is associated with: Select one: a.…

A: monopolistically competitive market refers to the form of market in which many firms offer goods and…

Q: Compared to a firm in perfect competition, in the short run the monopolistically competitive firm…

A: A perfectly competitive market is where several firms sell products that are identical. A…

Q: Suppose the accompanying graph depicts a monopolistically competitive firm earning positive economic…

A: Monopolistic competition is a kind of market structure in which there are several numbers of…

Q: What is the main difference between a perfectly competitive industry and a monopolistically…

A: What is the main difference between a perfectly competitive industry and a monopolistically…

Q: Which factors have driven growth of Vietnam? Discuss using the growth accounting model, Y=Č…

A: Y= C+I+G+NX Y= National income C= Consumption expenditure ( it is made by the consumers) G=…

Q: Because monopolistically competitive firms produce differentiated products, they will: Select one:…

A: Monopolistically competitive market is a market having some features of both competitive and…

Q: opose Gwen's Country Curtains is currently producing 1000 curtains per month at a price of $80. In…

A: In monopolistically competitive market, the sellers sell differentiated products which are close…

Q: WataDine is one of a city’s many restaurants that serve lunch and dinner in a monopolistically…

A: A market refers to a place where buyers and sellers can meet to facilitate the exchange or…

Q: If new firms enter a monopolistically competitive industry, what happens to the demand for the…

A: If the existing firm in a monopolistically competitive industry makes a positive economic profit in…

Q: A monopolistically competitive firm that earns an accounting profit in the short run Group of…

A: A monopolistic firm that earns accounting profit in the short run Could earn economic profit,break…

Q: In monopolistic competition,a firm produces 10,000 units when its marginal revenue equals its…

A: Monopolistic competition is a market structure where numerous firms offer different products,…

Q: Starting from the long-run trade equilibrium in the monopolistic competition model, as illustrated…

A: Monopolistic Competition is defined as the competition where there are a number of companies which…

Q: In the short-run, a monopolistically competitive firm: Select an answer and submit. For keyboard…

A: In a monopolistic competition differentiated products are sold by sellers. A monopolistic…

Q: The monopolistic competitor differs from the competitive firm in that it: Select one: a. charges a…

A: (Q)The monopolistic competitor differs from the competitive firm in that it: Select one: a.…

Q: The figure below depicts a monopolistically competitive firm operating in the short run. Label the…

A: A monopolistically competitive market has a large number of firms selling differentiated products.…

Q: ll of the following characteristics are common to both monopolistic competition and perfect…

A: The Perfectly competitive market refers to the market where large number of buyers and sellers exist…

Q: If monopolistically competitive firms in an industry are making an economic profit, then new firms…

A: A monopolistic competition is a market structure where there are large number of sellers producing…

Q: Which of the following are characteristics of monopolistic competition in the long A. blocked entry…

A: In a market system known as monopolistic competition, there are large sellers, each of whom offers a…

Question

In the long run, the economic profits in a monopolistically competitive industry tend to go towards zero. The main reason for this is:

differentiated products.

diseconomies of scale.

increased regulatory pressure on profitable firms.

free entry.

Definition Definition Form of market structure in which there are a large number of sellers of a particular product, with each seller selling somewhat differentiated but close substitutes to the product sold by other sellers. Features of monopolistic competition include: Large number of buyers and sellers Differentiated products Free entry and exit of the firms in the market

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

If monopolistically competitive firms are making zero economic profit, then these firms would: leave the industry. charge higher prices. make demand more inelastic. remain in the industry. begin to collude illegally.
Which of the following statements are true for a typical firm in this market given the transition from monopolistic competition to perfect competition? Check all that apply. Profit remains unchanged. Marginal cost decreases. The quantity decreases. Average total cost remains unchanged. The price decreases.
Describe an industry with monopolistic competition and identify an example in Canada.
Long run equilibrium under monopolistic competition is similar to that under perfect competition in that firms produce at the minimum point of their average cost curves. price equals marginal cost. firms earn normal profits. price equals marginal revenue.
In the long run, zero economic profit exists in monopolistic competition and perfect competition. true or false
Under perfect competition and monopolistic competition, profits are zero in long-run equilibrium.true or false
Refer to the graphic above. The output produced in this market (Monopolistic) is ____ units, while produced under a comparable perfectly competitive market would have been at least ____ units.
Why is there a price markup over marginal cost in monopolistic competition? a downward-sloping demand curve, price exceeds marginal cost The graph shows the demand curve and marginal revenue curve of Whitewater, Inc., a producer of rubber rafts in monopolistic competition. Draw the marginal cost curve if the firm produces 150 rafts a week. Label it. Draw a point at the intersection of the MC and MR curves. Draw a point to show the price that Whitewater charges for a raft when it produces 150 rafts a week. Draw an arrow to show the amount of Whitewater's markup. What is Whitewater's markup? Whitewater's markup is $750 a raft. 750- 675- 600- 525- 450- 375- 300- 225- 150- 75- 0 Price and cost (dollars per raft) 50 100 150 Quantity (rafts per week) D MR 200 >>> Draw only the objects specified in the question. 21
Which of the following is a characteristic of monopolistic competition? Group of answer choices Same products Competition only over price Easy entry and exit. One firm
Which of the following is not a characteristic of the market in which a monopolistic firm exists? Multiple Choice There is a high degree of brand loyalty among consumers. Producers have a high level of market power. The concentration ratio is low. Producers make independent product decisions.
A market where there are only a few sellers is known as: monopolistic. oligopolistic. monopolistically competitive. cartelized. perfectly competitive.
Which of the following is a requirement for both perfect competition and monopolistic competition? a) Consumers have all accurate information about firms, product and prices b) these are low barriers to enter and exit the market c) all firms sell the exact same product d) the producers have absolutely no control over the price they cha