Economists Have Long Debated Whether There Is a Significant Loss

question 223

Multiple Choice

Economists have long debated whether there is a significant loss of well-being to society in markets that are monopolistically competitive rather than perfectly competitive.Which of the following offers the best reason why some economists believe that monopolistically competitive markets are less efficient than perfectly competitive markets?

• A)In contrast to perfectly competitive markets, neither allocative efficiency nor productive efficiency are achieved in monopolistically competitive markets.
• B)In contrast to perfectly competitive markets, firms in monopolistically competitive markets earn economic profits in long-run equilibrium.
• C)In contrast to perfectly competitive markets, firms in monopolistically competitive markets do not produce where price equals average total cost in long-run equilibrium.
• D)In contrast to perfectly competitive markets, firms in monopolistically competitive markets can charge a price greater than average total cost in the short run.

---

Definitions:

Environmental

Related to or concerned with the ecological impacts on the planet, including conservation, pollution, and natural resource management.

Training Program

A structured plan of education or skill development to prepare individuals for specific jobs or roles.

On-the-job Training

Training provided to employees at their place of work, focusing on acquiring the skills necessary for their specific job roles through practical experience.

Training Program

An organized activity aimed at imparting information or instructions to improve the recipient's performance or to help them attain a required level of knowledge or skill.