The Figure Given Below Shows the Revenue and Cost Curves

question 41

Multiple Choice

The figure given below shows the revenue and cost curves of a firm. MC represents the marginal cost curve, AC the average cost curve, MR the marginal revenue curve, and AR the average revenue curve.Figure 9.4

-A monopolistically competitive firm faces a relatively-elastic demand curve as compared to a monopolist firm because of the:

• A)presence of a large number of buyers and barriers to entry.
• B)presence of a large number of firms and easy entry into the market.
• C)production of perfectly homogeneous products.
• D)production of unique products and the presence of barriers to entry.
• E)production of goods that are perfect complements of each other.

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Definitions:

Start-Up Cost

Initial expenses required to establish a business, including equipment, permits, and marketing.

Absolute Control

A situation where all power and decisions rest with one entity or individual, without any external influences or checks.

Double Taxation

The imposition of two or more taxes on the same income, asset, or financial transaction.

Sole Proprietorship

A business structure where a single individual owns and operates the business, bearing full responsibility for its assets and liabilities.