To Maximise Their Profits and Defend Those Profits from Competitors

question 235

Multiple Choice

To maximise their profits and defend those profits from competitors, monopolistically competitive firms must

• A)lobby government to erect barriers to entry in their industries.
• B)limit foreign competition in their markets by encouraging the government to impose tariffs and other trade restrictions.
• C)differentiate their products.
• D)achieve economies of scale.

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Definitions:

Competitive Firm

A company that operates in a market where there are many buyers and sellers, and it has little to no power to set prices for its products or services.

Union Membership

The state of individuals being members of a labor union, which is an organization intended to represent the collective interests of workers in negotiations with employers.

Rate of Unionization

The percentage of workers who are members of a union within a specific industry, sector, or economy.

Labor Demand Data

Statistical information that reflects the amount of labor that employers are willing and able to hire at different wage rates.