Lesson 5.12 - Comparison of Perfect Competition and Monopolistic Competition 1. states that a monopolistic competitor in equilibrium produces an output smaller than the one that would minimize its costs of production. 2. The perfectly competitive firm produces a quantity of output consistent with lowest 3. The monopolistic competitor is said to 4. The monopolistic competitor operates at excess capacity as a consequence of its demand curve, which is a consequence of 5. A monopolistic competitor charges P its plant size or to have excess capacity. sloping products. MC, which means it is not efficient. Also, A monopolistic competitor charges P means it operates at excess capacity and, therefore, is not efficient. lowest ATC, which

Lesson 5.12 - Comparison of Perfect Competition and Monopolistic Competition 1. states that a monopolistic competitor in equilibrium produces an output smaller than the one that would minimize its costs of production. 2. The perfectly competitive firm produces a quantity of output consistent with lowest 3. The monopolistic competitor is said to 4. The monopolistic competitor operates at excess capacity as a consequence of its demand curve, which is a consequence of 5. A monopolistic competitor charges P its plant size or to have excess capacity. sloping products. MC, which means it is not efficient. Also, A monopolistic competitor charges P means it operates at excess capacity and, therefore, is not efficient. lowest ATC, which

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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1. If the demand for a good increases at the same time as the supply of the same good decreases, what will happen to the equilibrium price and quantity of the good? Explain. 2. What is the deadweight loss of monopoly? Show the deadweight loss when the monopolist can perfectly price discriminate. 3. What is the point of long run equilibrium of a monopolistically competitive firm. How does it compare to a competitive firm.
Question 5 The diagram below illustrates a firm under monopolistic competition: Label the curves Curve I, Curve II, Curve III, Curve IV. Graphically identify profit maximizing output and price Explain how the amount of profit is defined at the maximum-profit output.
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The following table represents a monopolistically competitive market and the short-run costs of a firm in this market: Q TC MC TR MR 40 60 1 50 54 2 59 51 70 48 82 45 95 42 6. 110 39 7 128 36 8 151 33 179 30 (a) Complete the table, showing your work. (b) What is the profit-maximizing choice of output and price for this firm? How much profit does this firm make? Will new firms enter this industry in the long run? Explain. (c) What is the main difference in the assumptions we make between a perfectly competitive market and a monopolistically competitive market? How does this difference impact the outcomes of the market (price, quantity, profit) for each firm? Discuss.
The table above is for a monopolistic competitive firm. What will the firm's profit equal in the short run? Question 3 options: $0 $91 $102 $228
The table is for a monopolistic competitive firm in the short run. What will the firm's profit equal in the long run? Question 1 options: $0 $91 $102 $228
QUESTION 22 For monopolistically competitive firms in long-run equilibrium: the demand curve must intersect average total cost at its minimum. the demand curve must be tangent to the average total cost curve at its minimum. at the profit-maximizing quantity, the demand curve must intersect the average total cost curve quantity. at the profit-maximizing quantity, the demand curve must be tangent to the average total cost curve.
2) For a monopolistically competitive firm, Group of answer choices average revenue and price are the same. marginal revenue and price are the same. at the profit-maximizing quantity of output, price equals the minimum of average total cost. at the profit-maximizing quantity of output, price equals marginal cost.