Question 1

When a monopolistically competitive firm is in a long-run equilibrium, the values of marginal cost, average total cost, and price are all the same.

Accepted Answer

A) True 
 B)False

Question 2

In Lee Benham's 1972 article examining the impact of advertising on the average price paid for a pair of eyeglasses, Benham found that

Accepted Answer

A)  the average price paid for eyeglasses was nearly 20% higher in the states that did not restrict advertising.
B)  the average price paid for eyeglasses was nearly 20% lower in the states that did not restrict advertising.
C)  there was no difference in the average price paid between states that restricted advertising and those that did not.
D)  the average price paid for eyeglasses was almost 5 times higher in the states that did not restrict advertising.E) None of the above
F) B) and D)

Question 3

Figure 16-12 
-Refer to Figure 16-12. If this firm minimized cost, how much output will it produce?

Accepted Answer

The answer of Figure 16-12 
-Refer to Figure 16-12. If...

Question 4

Which of the following conditions distinguishes monopolistic competition from perfect competition?

Accepted Answer

A)  the number of sellers in the market
B)  the freedom of entry and exit by firms in the market
C)  the size of firms in the market
D)  product differentiationE) B) and D)
F) A) and B)

Question 5

Which of the following goods are not likely to be sold in monopolistically competitive markets?

Accepted Answer

A)  jeans
B)  books
C)  tap water
D)  clocksE) A) and B)
F) A) and C)

Question 6

Because monopolistically competitive firms produce differentiated products, each firm

Accepted Answer

A)  faces a demand curve that is horizontal.
B)  faces a demand curve that is vertical.
C)  has no control over product price.
D)  has some control over product price.E) A) and B)
F) B) and D)

Question 7

Entry and exit drive each firm in a monopolistically competitive market to a point of tangency between its

Accepted Answer

A)  marginal revenue curve and its total cost curve.
B)  marginal revenue curve and its average total cost curve.
C)  demand curve and its total cost curve.
D)  demand curve and its average total cost curve.E) A) and C)
F) All of the above

Question 8

Which of the following is not an argument made by critics of advertising?

Accepted Answer

A)  Advertising manipulates people's tastes.
B)  Advertising impedes competition.
C)  Advertising promotes economies of scale.
D)  Advertising increases the perception of product differentiation.E) All of the above
F) None of the above

Question 9

A study of the market for optometrists' services in the 1960s showed that

Accepted Answer

A)  all states in the United States prohibited advertising by optometrists.
B)  almost all professional optometrists opposed legal restrictions on their rights to advertise.
C)  the average price of eyeglasses would decrease if the legal restrictions on advertising by optometrists were removed.
D)  advertising on eyeglasses limited competition among optometrists.E) All of the above
F) A) and C)

Exam 16: Monopolistic Competition

Figure 16-12 -Refer to Figure 16-12. If this firm minimized cost, how much output will it produce?

Correct Answer
verified

A study of the market for optometrists' services in the 1960s showed that

Correct Answer
verified

Because monopolistically competitive firms produce differentiated products, each firm

Correct Answer
verified

Which of the following is not an argument made by critics of advertising?

Correct Answer
verified

Entry and exit drive each firm in a monopolistically competitive market to a point of tangency between its

Correct Answer
verified

In Lee Benham's 1972 article examining the impact of advertising on the average price paid for a pair of eyeglasses, Benham found that

Correct Answer
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Which of the following goods are not likely to be sold in monopolistically competitive markets?

Correct Answer
verified

When a monopolistically competitive firm is in a long-run equilibrium, the values of marginal cost, average total cost, and price are all the same.

Correct Answer
verified

Which of the following conditions distinguishes monopolistic competition from perfect competition?

Correct Answer
verified

Exam 16: Monopolistic Competition

Figure 16-12 -Refer to Figure 16-12. If this firm minimized cost, how much output will it produce?

Correct AnswerverifiedShow Answer

A study of the market for optometrists' services in the 1960s showed that

Correct AnswerverifiedShow Answer

Because monopolistically competitive firms produce differentiated products, each firm

Correct AnswerverifiedShow Answer

Which of the following is not an argument made by critics of advertising?

Correct AnswerverifiedShow Answer

Entry and exit drive each firm in a monopolistically competitive market to a point of tangency between its

Correct AnswerverifiedShow Answer

In Lee Benham's 1972 article examining the impact of advertising on the average price paid for a pair of eyeglasses, Benham found that

Correct AnswerverifiedShow Answer

Which of the following goods are not likely to be sold in monopolistically competitive markets?

Correct AnswerverifiedShow Answer

When a monopolistically competitive firm is in a long-run equilibrium, the values of marginal cost, average total cost, and price are all the same.

Correct AnswerverifiedShow Answer

Which of the following conditions distinguishes monopolistic competition from perfect competition?

Correct AnswerverifiedShow Answer

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Correct Answer
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