The Diagram Below Shows Demand and Cost Curves for a Monopolistically

question 52

Multiple Choice

The diagram below shows demand and cost curves for a monopolistically competitive firm.
FIGURE 11- 3
-The demand curve facing a monopolistically competitive firm is quite elastic because

• A)of the possibility of entry of new firms.
• B)there are many close substitutes to the good the firm is producing.
• C)the industry is producing a homogeneous product.
• D)firms are not behaving strategically.
• E)goods that are complements to the good the firm is producing also have elastic demand curves.

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Definitions:

Net Realizable Value

The estimated selling price of goods or assets in the ordinary course of business minus any costs involved in the sale or disposal process.

Accounts Receivable Turnover

A financial ratio that measures how efficiently a company collects revenue from its credit sales by comparing net credit sales with the average accounts receivable.

Net Realizable Value

The estimated selling price of goods minus the cost of their sale or disposal.

Direct Write-off Method

A method of accounting for bad debts that charges the amount directly to expense when it is determined to be uncollectible.