Suppose You Operate in a Monopolistically Competitive Market

question 248

Multiple Choice

Suppose you operate in a monopolistically competitive market. If you sell your good at a price of $20 and your average cost of production is $15

• A) your market may be in long-run equilibrium.
• B) you cannot be in short-run equilibrium.
• C) you should expect competing firms to enter your market and shift the demand curve for your good to the left.
• D) you should expect competing firms to enter your market and shift the demand curve for your good to the right.

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Definitions:

Mediation

A form of alternative dispute resolution where a neutral third party helps disputing parties find a mutually satisfactory solution to their conflict.

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A legal principle allowing federal courts to hear cases in which the parties are citizens of different states or countries.

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