A Monopolistically Competitive Firm That Is Profitable in the Short

question 252

Multiple Choice

A monopolistically competitive firm that is profitable in the short run will face competition that will eventually eliminate the firm's profits in the long run.But the firm can stave off competition and continue to earn economic profits if

• A)it can successfully sue its competitors for copyright infringement.
• B)it can move to another country where there is less competition.
• C)it can lobby the government to establish a price floor for its product.
• D)it can find new ways to differentiate its product.

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Definitions:

Effortful Thinking

The process of engaging in mental activities that require significant cognitive resources, as opposed to automatic or effortless thinking.

Problem Solving

The process of finding solutions to difficult or complex issues.

Intolerance for Ambiguity

A personality trait that describes individuals who struggle with uncertain, unclear, or unpredictable situations.

Need for Cognition

A psychological term referring to an individual's tendency to engage in and enjoy thinking, analysis, and problem-solving.