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Questions and Answers
What is the equilibrium output level for a monopolist?
What is the equilibrium output level for a monopolist?
- PC
- AB
- OQ (correct)
- OP
When does a monopolist enjoy normal profits?
When does a monopolist enjoy normal profits?
- When marginal cost is lower than marginal revenue
- When total revenue exceeds total cost
- When average revenue equals average cost (correct)
- When price is equal to marginal cost
What happens to super-normal profits in monopolistic competition in the long run?
What happens to super-normal profits in monopolistic competition in the long run?
- They increase due to higher demand
- They decrease as new firms enter the market (correct)
- They remain the same across all firms
- They become negative over time
In the short run, what condition leads a monopolist to incur losses?
In the short run, what condition leads a monopolist to incur losses?
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What level of output allows a monopoly firm to earn normal profits?
What level of output allows a monopoly firm to earn normal profits?
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At what point does a monopoly firm experience equilibrium based on the text?
At what point does a monopoly firm experience equilibrium based on the text?
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What happens when per unit cost exceeds the price in monopolistic competition?
What happens when per unit cost exceeds the price in monopolistic competition?
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What occurs in the long run to the profit levels of firms in monopolistic competition?
What occurs in the long run to the profit levels of firms in monopolistic competition?
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'Super-normal profits' are typically associated with which type of market structure?
'Super-normal profits' are typically associated with which type of market structure?
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What is the impact of an increase in firms on 'profit per firm' in monopolistic competition?
What is the impact of an increase in firms on 'profit per firm' in monopolistic competition?
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