In monopolistic competition
A) firms can earn long-run economic profit due to product differentiation.
B) firms are unable to earn economic profit over the long run.
C) firms can only earn accounting profits over the long-run.
D) firms can block entry.
QUESTION 2Monopolistic competition is characterized by
A) ease of entry.
B) many sellers.
C) product differentiation.
D) all of these choices characterize this market.
QUESTION 3In a monopoly, producer surplus is
A) larger than under perfect competition.
B) is equal to that under perfect competition.
C) smaller than under perfect competition.
D) None of these choices is true.
QUESTION 4In a monopoly, consumer surplus is
A) larger than under perfect competition.
B) is equal to that under perfect competition.
C) smaller than under perfect competition.
D) None of these choices is true.
QUESTION 5In a monopoly,
A) marginal revenue is greater than price.
B) marginal revenue is less than price.
C) the demand curve is horizontal.
D) marginal revenue and price are equal
QUESTION 6Over the long run, monopolies can earn
A) economic profit.
B) normal profit only.
C) accounting profit only.
D) no economic profit.
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