Which of the following is characteristic of a monopolistic competitor?
a. a standardized product
b. the ability to influence price
c. allocative efficiency
d. a horizontal firm demand curve
QUESTION 2Property rights specified in a contract are always open-ended and they exhaustively specify the owner's alternatives.
Indicate whether the statement is true or false
QUESTION 3Which of the following is not a characteristic of monopolistic competition?
a. a downward-sloping demand curve
b. differentiated products
c. standardized products
d. excess capacity
QUESTION 4Contracts are usually less costly to arrange and enforce than spot market transactions, and they bring benefits that are unobtainable in spot markets.
Indicate whether the statement is true or false
QUESTION 5In long-run equilibrium in a monopolistically competitive market, firms typically:
a. earn a normal profit.
b. charge a price equal to marginal cost.
c. earn an above-normal profit.
d. charge a price equal to marginal revenue.
QUESTION 6A contract can help a seller to receive better creditors to finance his/her inventory.
Indicate whether the statement is true or false
QUESTION 7Which of the following is generally true of a monopolistic competitor operating in the long run?
a. price equal to minimum average total cost
b. marginal cost exceeds marginal revenue
c. marginal revenue exceeds marginal cost
d. price exceeds marginal cost
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