3. The firm represented by Figure 11-2(c) is a. making a normal profit.
b. incurring a loss, once opportunity costs are considered.
c. producing at the same level of output as a purely competitive firm.
d. producing a standardized product.
4. Which of the following pairs are both competition-like elements in monopolistic competition?
a. Price exceeds MR; standardized product.
b. Entry is relatively easy; only a normal profit in the long run.
c. Price equals MC at the profit-maximizing output; economic profits are likely in the long run.
d. The firms' demand curve is downsloping; differentiated products.
Part Two • Microeconomics of Product Markets
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