Because a Monopolistically Competitive Firm Has Some Market Power, in the Long

question 211

Multiple Choice

Because a monopolistically competitive firm has some market power, in the long run the price of its good exceeds its:

• A)average revenue
• B)total cost
• C)average cost
• D)marginal cost

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Definitions:

Franchised Specialty Goods

Retail products sold through outlets operating under a franchise agreement, often focusing on a niche market.

Rack Jobber

A company or individual who provides and stocks merchandise in stores, typically in specialty areas, and shares profits with the retailer or pays for shelf space.

Limited-Function Merchant Wholesaler

A wholesaler that offers a narrower range of services than full-service wholesalers, typically specializing in only certain kinds of products or functions.

Merchant Wholesaler

A type of intermediary that buys goods in bulk from manufacturers or producers and sells them in smaller quantities to retailers or other businesses.