In the Short Run, Firms in Monopolistically Competitive Markets

question 221

Multiple Choice

In the short run, firms in monopolistically competitive markets

• A)produce the output level where marginal revenue equals marginal cost.
• B)can earn economic profits.
• C)face a downward-sloping demand curve.
• D)All of these responses are correct.

---

Definitions:

Net Pay

Gross earnings, less deductions. Net pay, or take-home pay, is what the worker actually takes home.

Wages and Salaries Payable

Liabilities for wages and salaries that have been earned by employees but have not yet been paid.

Federal Income Taxes Payable

The amount of income tax that a company or individual owes to the federal government and has not yet paid.

Payroll Taxes Payable

Liabilities owed to tax authorities for employee taxes withheld and employer payroll taxes; to be paid within a specified period.