Figure 10.18 -Refer to Figure 10.18.The Diagram Demonstrates That

question 15

Multiple Choice

Figure 10.18
-Refer to Figure 10.18.The diagram demonstrates that

• A)in the short run, the monopolistic competitor produces an output Q_b, but in the long run after it adjusts its capacity, it will produce the allocatively efficient output, Q_a.
• B)it is not possible for a monopolistic competitor to produce the productively efficient output level, Q_a, because of product differentiation.
• C)it is possible for a monopolistic competitor to produce the productively efficient output level, Q_a, if it is willing to lower its price from P_b to P_a.
• D)in the long run, the monopolistic competitor produces the minimum-cost output level, Q_a, but in the short run its output of Q_b is not cost minimising.

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Definitions:

Long-Term Goals

Objectives intended to be achieved over an extended period, typically beyond a year.

Intelligence

The ability to acquire and apply knowledge and skills, showing the capacity for logic, understanding, self-awareness, learning, emotional knowledge, reasoning, planning, creativity, and problem-solving.

Resilience

The ability to recover quickly from difficulties or adapt to change effectively.

Obstacles

Refers to challenges or barriers that hinder progress towards a goal.