(1) The products sold by monopolistically competitive firms A. are close substit
ID: 1164638 • Letter: #
Question
(1) The products sold by monopolistically competitive firms
A. are close substitutes of each other. B. are homogeneous. C. can be either homogeneous or differentiated. D. are differentiated.
(2) Typically a mix of informational and persuasive advertising is used for
A.
B.
C.
D.
experience goods.
(3) A monopolistic competitor will maximize its profits at the output level at which
A.
B.
C.
D.
MC = MR.
(4) A monopolistic competitor will maximize its profits at the output level at which
A.
B.
C.
D.
A.
credible goods.B.
credence goods.C.
search goods.D.
experience goods.
(3) A monopolistic competitor will maximize its profits at the output level at which
A.
the MC curve intersects the demand curve.B.
TC = TR.C.
MR = ATC.D.
MC = MR.
(4) A monopolistic competitor will maximize its profits at the output level at which
A.
the MC curve intersects the demand curve.B.
TC = TR.C.
MR = ATC.D.
MC = MR.Explanation / Answer
Ans1) the correct option is D. are differentiated. Product differentiation increases the perceived value of the firm's products relative to competitor's products.
Ans2) The correct option is A. Credible goods
Ans3) the correct option is D. MC = MR. At profit maximisation MR curve intersects MC
Ans4) the correct option is D. MC = MR
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