The Use of the Word "Competition" in the Name of the Market

question 11

Multiple Choice

The use of the word "competition" in the name of the market structure called "monopolistic competition" refers to the fact that

• A) There are many sellers in a monopolistically competitive market and there is free entry and exit in the market just like a competitive market.
• B) Monopolistically competitive firms face a downward-sloping demand curve just like competitive firms.
• C) Monopolistically competitive firms charge prices equal to the minimum of their average total cost just like competitive firms.
• D) The products are differentiated in a monopolistically competitive market just like in a competitive market.

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Definitions:

Soybean Oil

A vegetable oil extracted from the seeds of the soybean, used in cooking and in the production of various food products and industrial applications.

Unsaturated Fatty Acid

A fatty acid that contains one or more double bonds between carbon atoms, which can influence the fluidity of cell membranes and are often found in plant oils.

Saturated Fatty Acid

A type of fatty acid where all carbon atoms are bonded to hydrogen atoms, without any double bonds.

Lecithin

A fatty substance found in plant and animal tissues, used as an emulsifier in food products, as well as in pharmaceutical and cosmetic formulations.