Figure 11-7 -It Is Not True in the Long Run of Monopolies

question 77

Multiple Choice

Figure 11-7
-It is not true in the long run of monopolies that

• A)other firms seeking positive economic profit enter the market.
• B)they earn positive economic profit.
• C)they sell their output at a price greater than marginal cost.
• D)they benefit from barriers to entry.

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Definitions:

Franchising

A method of doing business wherein a franchisor licenses trademarks and proven methods of doing business to a franchisee in exchange for a recurring payment, and often a percentage of the franchisee's revenue.

Franchisors

Individuals or companies that grant a license to others allowing them to operate a business under the franchisor's brand and business model.

Experience

The knowledge or skill acquired by a period of practical involvement in or exposure to events or activities.

Franchised Businesses

Companies that operate under the model where individuals (franchisees) are granted the rights by a franchisor to operate a business under the franchisor's brand and system in exchange for a fee.