IHBhopolistically ule lirms sell differentiated products, but it is competitive
ID: 1119304 • Letter: I
Question
IHBhopolistically ule lirms sell differentiated products, but it is competitive if the firms sell identical products. If there are many firms participating in a market, the market is either a. an oligopoly or monopolistically competitive. b. perfectly competitive or monopolistically competitive. c. an oligopoly or perfectly competitive. d. an oligopoly or a cartel. Which of the following statements is correct? a. Monopolistic competition is similar to monopoly because both market structures b. Monopolistic competition is similar to perfect competition because both market c. Monopolistic competition is similar to oligopoly because both market structures d. Monopolistic competition is similar to perfect competition because both marke are characterized by patents. structures are characterized by each seller being small compared to the market. are characterized by free entry. structures are characterized by excess capacity. In both perfect competition and monopolistic competition, each firm a. has some monopoly power. b. sells a product that is at least slightly different from those of other firms. c. faces a downward-sloping demand curve. d. has many competitors. Which of the following conditions distinguishes monopolistic competition from perfe 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 differentiation a. price and quantity just as a monopoly does b. quantity but faces a horizontal demand curve just as a competitive firm c. price but can sell any quantity at the market price just as an oligopoly d A monopolistically competitive firm chooses its and quantity based on the decisions of the other firms in the indu does.Explanation / Answer
1.
B
In perfect competition and the monopolistic competition, there are no barrier to entry and exit in the market. Hence, the number of firms are huge in these two markets.
2.
B
Players are relatively small in the market of perfect competition and monopolistic competition.
3.
D
there are many players in these markets due to no any barrier of entry and exit. Hence, one firm has many competitors.
4.
D
In monopolistic competition, there is a case of product differentiation. But, in perfect competition, products are homogeneous in nature.
5.
A
The price and quality is decided on the basis of MR = MC.
The condition of MR, equal to MC is chosen by the monopoly as well as monopolistic firm.