What Is the Primary Difference Between a Monopolistically Competitive Firm

question 14

Multiple Choice

What is the primary difference between a monopolistically competitive firm and a monopoly?

• A)The ability for competition to enter the market in the long run.
• B)The ability for competition to enter the market in the short run.
• C)Only the monopolistically competitive firm is a price taker.
• D)Only the monopolist can set price equal to demand.

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Definitions:

Fixed Overhead Volume Variance

The difference between the budgeted and actual volume of units produced, multiplied by the standard fixed overhead rate.

Labour Efficiency Variance

The difference between the actual labor hours taken to produce a good and the standard hours expected, multiplied by the standard labor rate.

Actual Labour Hours

Actual Labour Hours refer to the total hours worked by employees, measured after the work has been completed, usually for comparison with planned or budgeted hours.