In Monopoly and Monopolistic Competition, Price Is Greater Than Marginal

question 164

Multiple Choice

In monopoly and monopolistic competition, price is greater than marginal cost. This is an indication that

• A)both industries result in product variety.
• B)both industries make economic profits in the long run.
• C)there are barriers to entry in both types of industries.
• D)marginal costs must be very low in both types of industries.
• E)both industries result in deadweight loss.

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Definitions:

Agoraphobia

Anxiety disorder characterized by fear of places and situations in which it would be difficult to escape, such as enclosed places, open spaces, and crowds.

Paranoia

A mental condition characterized by delusions of persecution, unwarranted jealousy, or exaggerated self-importance, typically worked into an organized system.

Major Depression

A mental disorder characterized by a persistent feeling of sadness, loss of interest, and other emotional and physical symptoms that significantly impair daily functioning.

Lithium

A medication commonly used to treat and prevent manic episodes in people with bipolar disorder.