In the Long Run, a Firm in a Perfectly Competitive

question 411

Multiple Choice

In the long run, a firm in a perfectly competitive market operates

• A)at its efficient scale, and a monopolistically competitive firm operates at its efficient scale.
• B)at its efficient scale, and a monopolistically competitive firm operates with excess capacity.
• C)with excess capacity, and a monopolistically competitive firm operates with excess capacity.
• D)with excess capacity, and a monopolistically competitive firm operates at its efficient scale.

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Definitions:

Nonfraudulent Representation

Any statement or declaration that is truthful and not intended to deceive or mislead.

Scienter

A legal term referring to the knowledge of wrongdoing or fraudulent intent in actions that lead to litigation, particularly in securities fraud.

Silence

The absence of sound or the state of choosing not to speak or respond in communication.

Fraud

Consciously tricking someone in order to gain illicitly or to rob a victim of their rightful due.