Answer to Question #320525 in Macroeconomics for anna

Question

3. For each of the following characteristics, say

whether it describes a perfectly competitive firm, a

monopolistically competitive firm, both, or neither.

a. sells a product differentiated from that of its

competitors

b. has marginal revenue less than price

c. earns economic profit in the long run

d. produces at the minimum of average total cost in

the long run

e. equates marginal revenue and marginal cost

f. charges a price above marginal cost

Answer 1

a.) Monopolistically competitive firm.

b.) Monopolistically competitive firm.

c.) Neither monopolistic nor perfect competition.

d.) Perfect competition.

e.) Both monopolistic and perfect competition.

f.) Monopolistically competitive firm.