Exam 13: Monopolistic Competition: the Competitive Model in a More Realistic Setting

Table 13-4 Table 13-4 lists estimated revenues and costs (per week) for plastic vials (100 vials per box) for the Victoria Biological Supplies Company. Victoria sells plastic vials to universities and private research laboratories. -Refer to Table 13-4. Victoria's profit-maximizing output is where

Figure 13-11 -Refer to Figure 13-11. What is the productively efficient output for the firm represented in the diagram?

Figure 13-17 -Refer to Figure 13-17. In the long run, why will the firm produce Q_f units and not Q_g units, which has a lower its average cost of production?

If a typical monopolistically competitive firm is incurring short-run losses, then

If a firm faces a downward-sloping demand curve,

If a firm can produce a product at a lower average cost than its competitors, it stands a better chance of earning an economic profit.

For a profit-maximizing monopolistically competitive firm, for the last unit sold, the marginal cost of production is less than the marginal benefit received by a customer from the purchase of that unit.

What is meant by "excess capacity"? How does it relate to consumer utility?

Which of the following is true for a firm with a downward-sloping demand curve for its product?

A monopolistically competitive firm should lower its price if its marginal revenue exceeds its marginal cost.

If buyers of a monopolistically competitive product feel the products of different sellers are strongly differentiated, then the demand for each seller's product is

Which of the following can a firm use to defend a successful product's brand name?

Figure 13-4 Figure 13-4 shows short-run cost and demand curves for a monopolistically competitive firm in the market for designer watches. -Refer to Figure 13-4. What is the area that represents the total fixed cost of production?

Figure 13-9 -Refer to Figure 13-9. Which of the graphs in the figure depicts a monopolistically competitive firm that is earning economic profits?

Figure 13-3 -Refer to Figure 13-3. What is the marginal revenue of the sixth unit of output?

All of the following characteristics are common to both monopolistic competition and perfect competition except

If a firm has excess capacity, then

When a monopolistically competitive firm breaks even in the long run, this is equivalent to earning a zero accounting profit.

Figure 13-11 -Refer to Figure 13-11. What is the monopolistic competitor's profit maximizing price?

Which of the following describes the relative positions of the demand curve and the average total cost (ATC) curve of a monopolistically competitive firm that earns a profit in the short run?