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c23sendout - 1. Monopolistic competition is characterized...

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1. Monopolistic competition is characterized by a: A) few dominant firms and low entry barriers. B) large number of firms and substantial entry barriers. C) large number of firms and low entry barriers. D) few dominant firms and substantial entry barriers. 2. Nonprice competition refers to: A) competition between products of different industries, for example, competition between aluminum and steel in the manufacture of automobile parts. B) price increases by a firm that are ignored by its rivals. C) advertising, product promotion, and changes in the real or perceived characteristics of a product. D) reductions in production costs that are not reflected in price reductions. 3. A monopolistically competitive industry combines elements of both competition and monopoly . The monopoly element results from: A) the likelihood of collusion. B) high entry barriers. C) product differentiation. D) mutual interdependence in decision making. 4. The monopolistically competitive seller maximizes profit by producing at the point where: A) total revenue is at a maximum. B) average costs are at a minimum. C) marginal revenue equals marginal cost. D) price equals marginal revenue. 5. Excess capacity refers to the: A) amount by which actual production falls short of the minimum ATC output. B) fact that entry barriers artificially reduce the number of firms in an industry. C)
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This note was uploaded on 06/26/2011 for the course ECO 202 taught by Professor Lea during the Spring '08 term at VCCS.

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c23sendout - 1. Monopolistic competition is characterized...

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