In the Long Run, Both Monopolistic Competition and Perfect Competition

question 97

Multiple Choice

In the long run, both monopolistic competition and perfect competition result in:

• A) a wide variety of brand-name choices for consumers.
• B) an efficient allocation of resources.
• C) zero economic profit for firms.
• D) excess capacity.

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Definitions:

Future Supply

Future supply refers to the quantity of a good or service that will be available in the market at future dates, based on current expectations of production and market conditions.

Proved Reserves

Quantities of natural resources, like oil or gas, that geological and engineering information indicates with reasonable certainty can be recovered in the future from known reservoirs under existing economic and operating conditions.

Petroleum Industry

A global sector involved in the exploration, extraction, refinement, transportation, and marketing of petroleum products.

Current Prices

Prices at which goods and services are sold in the market at the present time, not adjusted for inflation.