Answer the Question Based on the Demand and Cost Schedules

question 165

Multiple Choice

Answer the question based on the demand and cost schedules for a monopolistically competitive firm given in the table below. Suppose that entry into this industry changes this firm's demand schedule from columns (1) and (3) to columns (2) and (3) . We can conclude that this industry is

• A)a pure monopoly.
• B)purely competitive.
• C)a constant cost industry.
• D)monopolistically competitive.

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Definitions:

Optimal Lot Size

The most economically advantageous quantity of a product to order or produce, balancing between ordering costs and holding costs.

Economic Order Quantity

A formula used to determine the most cost-effective quantity of inventory to order, balancing the costs of ordering and holding stock.

Optimal Order Quantity

The most efficient amount of stock to order that minimizes total inventory costs, including ordering and holding costs.

Ordering Costs

Expenses associated with making an order for goods, including costs for processing, shipping, and receiving materials.