If a Perfectly Competitive Firm and a Monopolistic Competitor in Long

question 120

Multiple Choice

If a perfectly competitive firm and a monopolistic competitor in long run equilibrium face the same demand and cost curves, then the competitive firm will produce a

• A)greater output and charge a lower price than the monopolistic competitor.
• B)greater output, but charge the same price as the monopolistic competitor.
• C)greater output and charge a higher price than the monopolistic competitor.
• D)smaller output and charge a lower price than the monopolistic competitor.
• E)smaller output and charge a higher price than the monopolistic competitor.

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Definitions:

Easement

A legal right to use another person's land for a specific limited purpose.

Land Adjacent

Property that is next to or bordering another property.

Future Interest

A person’s present right to property ownership and possession in the future.

Present Right

The current legal ability to exercise a right or claim to property, as opposed to a future or conditional interest.