A Monopolistic Competitor's Demand Curve Becomes Less Elastic as New

question 142

True/False

A monopolistic competitor's demand curve becomes less elastic as new entry occurs.

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Definitions:

Economic Profit

The difference between a firm's total revenue and its total costs, including both explicit and implicit costs.

Accounting Profit

The total revenue of a business minus the explicit costs of operating the business.

Implicit Costs

The opportunity costs associated with a company's use of resources that are not directly paid for or billed.

Implicit Cost

The opportunity costs that are not directly paid or incurred but represent the loss of alternative benefits when resources are used in a particular way.