The Existence of a Large Number of Firms in Monopolistic

question 43

Multiple Choice

The existence of a large number of firms in monopolistic competition

• A)means that each firm has a small market share.
• B)makes it possible for each firm's price to deviate by a large amount from the average price of the other firms.
• C)means that a firm must pay attention to the behaviour of all of its competitors.
• D)All of the above answers are correct.
• E)None of the above answers are correct.

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Definitions:

Gift

A voluntary transfer of property or funds from one person to another without receiving anything in return, or at least without expecting a return equal to the value of the gift.

Short-Term Capital Loss

A financial loss realized on the sale of securities or assets held for one year or less, which can be used to offset capital gains for tax purposes.

Long-Term Capital Gain

The profit from the sale of an asset held for more than a year, generally taxed at a lower rate than short-term gains.

AGI

Adjusted Gross Income, the total income minus specific deductions, serving as a basis for calculating taxable income and certain tax credits.