Which Statement Concerning Monopolistic Competition Is False

question 125

Multiple Choice

Which statement concerning monopolistic competition is false?

• A) Long-run equilibrium under monopolistic competition is achieved where economic profits are zero.
• B) Monopolistic competition is likely to result in a greater variety of product brands than pure competition.
• C) The monopolistically competitive demand curve is more elastic than the demand curve facing a monopolistic firm.
• D) Monopolistic competition does not lead to any economic inefficiency since firms in this industry cannot sustain economic profits.

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Definitions:

Automatization

The process by which tasks become automatic after extensive practice, requiring less cognitive effort to perform.

Storage

In the context of cognition, refers to the retention of information in the memory over time.

Retrieval

The process of accessing and bringing into consciousness information stored in memory.

Automatization

The process by which tasks become automatic through repetition, requiring less cognitive effort over time.