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5) Is a monopolistically competitive firm productively efficient? A) Yes, because it produces where marginal cost equals marginal revenue. B) Yes, because price equals average total cost. C) No, because price is greater than marginal cost. D) No, because it does not produce at minimum average total cost. 6) For the monopolistically competitive firm 7) Why do most firms in monopolistic competition typically make zero profit in the long run?
8) A monopolistically competitive firm will 9) Refer to Figure 13-3. The marginal revenue from one additional unit sold is the sum of the gain in revenue from selling the additional unit and the loss in revenue from having to charge a lower price to sell the additional unit. Based on the diagram in the figure, A) X represents the gain (price effect) and Y the loss (output effect). B) Y represents the gain (output effect) and X the loss (price effect). C) X represents the loss (price effect) and Y + Z the gain (output effect). D) X + Z represents the loss (output effect) and Y the gain (price effect).