The Figure Below Shows the Revenue and Cost Curves of a Monopolistically

question 22

Multiple Choice

The figure below shows the revenue and cost curves of a monopolistically competitive firm.Figure: 12.2
In the figure,
D: Demand curve
MR: Marginal revenue curve
ATC₁ and ATC₂: Average total cost curves
MC: Marginal cost curve
-In contrast to perfect competition, in a monopolistically competitive industry:

• A)new firms entering the market produce a good that is identical to the existing ones.
• B)new firms entering the market produce a completely different product.
• C)there are legal restrictions on the entry of new firms.
• D)new firms entering the market produce a close substitute, not an identical or standardized product.
• E)new firms are allowed to enter the industry but there are legal restrictions on their exit.

---

Definitions:

Hippocampus

A major component of the brain involved in learning and memory formation.

Association Areas

Regions of the brain that integrate and process information from the sensory pathways and other parts of the brain for higher functions such as learning, reasoning, and problem-solving.

Cortex

The outermost layer of the brain, responsible for complex functions including thought, memory, and consciousness.

Frontal Lobe

The part of the brain located at the front of each cerebral hemisphere, responsible for voluntary movement and has a role in activities such as decision-making, problem-solving, and planning.