The Demand Curve Facing a Monopolistically Competitive Firm Is Quite

question 36

Multiple Choice

The demand curve facing a monopolistically competitive firm is quite elastic because

• A)there are many close substitutes to the good the firm is producing.
• B)goods that are complements to the good the firm is producing also have elastic demand curves.
• C)of the possibility of entry of new firms.
• D)the industry is producing a homogeneous product.
• E)firms are not behaving strategically.

---

Definitions:

Economic Roles

The functions and positions individuals and groups occupy in the economic system, affecting how they produce, distribute, and consume goods and services.

Single-Income

Pertaining to a household or an individual who relies on one source of income, typically from one wage earner.

Two-Income Couples

Households in which both partners earn wages or salaries, contributing to the family's total income.

Economic Roles

Functions and responsibilities assumed by individuals or groups within an economic system, including production, distribution, and consumption of goods and services.