The Efficiency of Monopolistic Competition

question 49

Multiple Choice

The efficiency of monopolistic competition

• A) is as clear-cut as the efficiency of perfect competition.
• B) depends on whether the gain from extra product variety offsets the selling costs and the extra cost that arises from excess capacity.
• C) comes from its excess capacity.
• D) is eliminated in the long run.
• E) is equal to that of monopoly.

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Definitions:

Liberals

Individuals or political parties advocating for policies that emphasize individual freedoms, social justice, and progressive reform.

Conservatives

Individuals or political factions favoring traditional views and values, advocating for minimal governmental intervention in the economy and society.

Socialists

People who advocate for socialism, a political and economic theory of social organization advocating for the means of production, distribution, and exchange to be owned or regulated by the community as a whole.

Federalists

Supporters of the ratification of the U.S. Constitution, advocating for a strong federal government and the creation of a union of states with a centralized authority.