Which Is True of Pure Competition but Not of Monopolistic

question 204

Multiple Choice

Which is true of pure competition but not of monopolistic competition?

• A)There are no significant barriers to entry.
• B)Long-run economic profits are zero.
• C)There are a large number of firms in the market.
• D)Long-run equilibrium occurs at the minimum point on the ATC curve.

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Definitions:

Profitability Index

A capital budgeting tool that measures the ratio of the present value of future cash flows from an investment to the investment's initial cost.

Mutually Exclusive

Situations or events that cannot both occur at the same time.

Net Present Value

A financial metric that calculates the present value of all cash flows, both incoming and outgoing, of an investment.

Managers

People in charge of managing or overseeing any or all parts of a corporation or comparable entity.