To Analyze Monopolistic Competition in Trade, We Make Several Assumptions

question 135

Multiple Choice

To analyze monopolistic competition in trade, we make several assumptions about the market. Which of the following is NOT an assumption of monopolistic competition?

• A) many firms in the industry
• B) easy entry and exit
• C) constant long-run average cost
• D) increasing returns to scale

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Definitions:

Humanism

In the Renaissance, an emphasis on education and on expanding knowledge (especially of classical antiquity), the exploration of individual potential and a desire to excel, and a commitment to civic responsibility and moral duty.

Palazzo Medici-Riccardi

A Renaissance palace in Florence, Italy, which served as the main residence of the Medici family, showcasing the wealth and power of this influential family.

Michelozzo

An Italian architect and sculptor of the Renaissance, known for his collaboration with Donatello and for designing the Palazzo Medici Riccardi in Florence.

Santa Croce

A historic Franciscan church in Florence, Italy, known for its art and as the burial place of famous Italians.