Exam 13: Monopolistic Competition: the Competitive Model in a

Figure 13-13 -Refer to Figure 13-13.If the diagram represents a typical firm in the market, what is likely to happen to its average cost of production in the long run?

A trademark is

Table 13-3 Table 13-3 shows the demand and cost schedules for a monopolistically competitive firm. -Refer to Table 13-3.What is the amount of the firm's loss at its optimal output level?

If buyers of a monopolistically competitive product feel the products of different sellers have little differences between them, then the demand for each seller's product is relatively elastic.

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 loss incurred by the firm?

If the price exceeds the average variable cost but is less than the average total cost, a firm

Which of the following is true of a typical firm in a monopolistically competitive industry?

Which of the following statements is true?

Table 13-1 -Refer to Table 13-1.What is the marginal revenue of the 3rd unit?

Table 13-3 Table 13-3 shows the demand and cost schedules for a monopolistically competitive firm. -Refer to Table 13-3.What is the best course of action for the firm in the short run?

Juicy Couture has been successful in selling women's clothing using an unusual strategy.According to an article in the Wall Street Journal, the key to the firm's strategy is to "limit distribution to maintain the brand's exclusive cachet, even if that means sacrificing sales, a brand-management technique once used only for high-end luxury brands." In 2006, Juicy clothes were sold in only four department stores: Neiman Marcus, Saks, Bloomingdale's, and Nordstrom.In 2006, its sales have more than quadrupled since 2002. Source: Rachel Dodes, "From Track Suits to Fast Track," Wall Street Journal, September 13, 2006. How does limiting the number of stores in which Juicy's products are sold contribute to its success?

Some factors that allow firms to make economic profits are beyond its control.All but one of the following is an uncontrollable factor.Which factor is controllable?

A monopolistically competitive firm that earns economic profits in the short run will be able to expand its market share even if the market size remains constant.

Explain the similarities and differences between the long-run equilibrium for a perfectly competitive firm and a monopolistically competitive firm.Illustrate your answer with a graph demonstrating the long-run equilibrium for the two types of firms.

Central Grocery in New Orleans is famous for its muffaletta, a large round sandwich filled with deli meats and topped with a tangy olive salad.Suppose the following table represents cost and revenue data for Central Grocery.Fill in the columns for TR, MR, MC, ATC, and profit.If Central Grocery wants to maximize profits, what price should it charge for a muffaletta, what quantity should it sell, and what will be the amount of its total profit?

If a perfectly competitive firm maximizes short-run profits, its marginal revenue will be positive and less than its price.

A monopolistically competitive firm maximizes profit where

Which of the following is a disadvantage of trademarking a firm's product?

If a firm has excess capacity, then

If the demand curve for a firm is downward-sloping, its marginal revenue curve