Use the Following to Answer Questions

question 100

Multiple Choice

Use the following to answer questions:
Figure: Monopolistic Competition
-(Figure: Monopolistic Competition) Refer to the figure. Suppose the figure represents a firm that operates in a monopolistic competitive market. In this market, in the long run you would expect:

• A) both demand and price to stay the same.
• B) both demand and price to increase as unprofitable firms leave the industry.
• C) demand to decrease and price to fall to the point that P = AC.
• D) demand to shift left and decrease price to the point that P = MC.

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Definitions:

Milling

A mechanical process that involves grinding, cutting, or crushing materials to create finer particles.

Subsurface Oil

Oil deposits located beneath the surface of the Earth, typically extracted through drilling operations.

Overthrust Belt

A region in the earth's crust where large areas of rock have been moved over one another typically due to compressional forces.

Anticline

A type of fold that is convex up and has its oldest beds at its core, often associated with the trapping of petroleum.