Is a Monopolistically Competitive Firm Allocatively Efficient

question 216

Multiple Choice

Is a monopolistically competitive firm allocatively efficient?

• A)No, because it does not produce at minimum average total cost.
• B)Yes, because it produces where marginal cost equals marginal revenue.
• C)No, because price is greater than marginal cost.
• D)Yes, because price equals average total cost.

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Definitions:

Neuron

Morphologic and functional unit of the nervous system, consisting of the nerve cell body, the dendrites, and the axon; also called nerve cell.

Synaptic Vesicles

Small organelles within neurons that store and release neurotransmitters at the synapse.

Neurotransmitters

Chemicals released by neurons to transmit signals across a synaptic gap to a target cell.

Presynaptic Terminals

The ends of axons where neurotransmitters are stored before being released into the synaptic cleft in response to a nerve impulse.