Freedom of Entry and Exit in Monopolistic Competition

question 22

Multiple Choice

Freedom of entry and exit in monopolistic competition

• A) means that firms' price and average total cost of producing are always equal.
• B) never allows firms to earn economic profits.
• C) leads to falling prices when new firms enter the market.
• D) forces firms to abandon product differentiation but only in the long run.

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Definitions:

Aggressiveness

Refers to behavioral patterns that express hostility or the desire to dominate.

Independent Variable

The variable that is manipulated by the researcher to observe its effect on the dependent variable.

One-shot Case Study

A research design where a single group is observed or studied after some intervention, lacking a comparison with a control group.

Fear of Earthquakes

An anxiety disorder where individuals have an excessive and irrational fear of earthquakes.