The Product-Variety Externality Associated with Monopolistic Competition Arises Because in Monopolistically

question 142

Multiple Choice

The product-variety externality associated with monopolistic competition arises because in monopolistically competitive markets:

• A)entry and exit are not restricted
• B)firms produce at excess capacity
• C)firms try to differentiate their products
• D)firms produce homogeneous products

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Definitions:

Colonialism

The policy or practice of acquiring full or partial political control over another country, occupying it with settlers, and exploiting it economically.

Missile Gap

The claim, raised by John F. Kennedy during his campaign for president in 1960, that the Soviet Union had developed a technological and military advantage during Eisenhower’s presidency.

The Beats

A group of American writers and artists in the 1950s who explored and influenced American culture and politics with their unconventional literary style and countercultural beliefs.