The most important factor that drives the long-run profit to zero in monopolistic competition is the elasticity of the market demand curve the elasticity of the firm's demand curve free entry and exit the reaction of rival firms to a change in price
The most important factor that drives the long-run profit to zero in monopolistic competition is the elasticity of the market demand curve the elasticity of the firm's demand curve free entry and exit the reaction of rival firms to a change in price
Chapter1: Making Economics Decisions
Section: Chapter Questions
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![The most important factor that drives the long-run profit to zero in monopolistic competition is
the elasticity of the market demand curve
the elasticity of the firm's demand curve
free entry and exit
O the reaction of rival firms to a change in price
What is one difference between the Cournot and Stackelberg models?
O In Cournot, both firms make price decisions simultaneously, and in Stackelberg, one firm sets its price
level first
O In Stackelberg, both firms make price decisions simultaneously, and in Cournot, one firm sets its price
level first
O In Cournot, both firms make output decisions simultaneously, and in Stackelberg, one firm sets its output
level first
O In Stackelberg, both firms make output decisions simultaneously, and in Cournot, one firm sets its output
level first
O Profits are zero in Cournot and positive in Stackelberg](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa602b8b9-f7b5-4fc2-b81f-f9c674427d5c%2F6abf16d1-d129-47cf-b83e-820c77cd5c9b%2Fmoa3nf6_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The most important factor that drives the long-run profit to zero in monopolistic competition is
the elasticity of the market demand curve
the elasticity of the firm's demand curve
free entry and exit
O the reaction of rival firms to a change in price
What is one difference between the Cournot and Stackelberg models?
O In Cournot, both firms make price decisions simultaneously, and in Stackelberg, one firm sets its price
level first
O In Stackelberg, both firms make price decisions simultaneously, and in Cournot, one firm sets its price
level first
O In Cournot, both firms make output decisions simultaneously, and in Stackelberg, one firm sets its output
level first
O In Stackelberg, both firms make output decisions simultaneously, and in Cournot, one firm sets its output
level first
O Profits are zero in Cournot and positive in Stackelberg
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