Suppose There Are Many Independent Dry Cleaners in Your City,each

question 87

Multiple Choice

Suppose there are many independent dry cleaners in your city,each of which is earning economic profits.According to the theory of monopolistic competition,

• A)existing dry cleaners will cooperate and maximize their joint profits.
• B)existing dry cleaners will engage in non-price competition and maintain their profits in the long run.
• C)existing dry cleaners will expand until they reach the quantity associated with minimum long-run average cost.
• D)existing dry cleaners will cooperate and restrict entry of new firms.
• E)new dry cleaners will enter this market until each firm is earning zero profits.

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Definitions:

Organisation Goals

The aims or targets that an organization seeks to achieve, which guide its overall strategy and direction.

Manager's Behaviour

The actions, strategies, and practices employed by a manager in guiding, leading, and managing a team or an organization.

Service Level Agreements

Formal contracts between service providers and customers that outline the level of service expected, including timelines and quality benchmarks.

Transfer Price

Transfer Price is the price at which divisions of a company transact with each other, such as the trade of supplies or labor between departments.