Under Monopolistic Competition ________

question 44

Multiple Choice

Under monopolistic competition ________.

• A)the goods purchased are assumed to be standardized products
• B)it is good (or brand)differentiation that likely accounts for some price stickiness
• C)buyers and sellers do not set prices and can only decide how much to buy and sell
• D)all of the above
• E)none of the above

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Definitions:

Competitive Buyer

A buyer in a market who has no influence on the market price and must accept the market price as given.

Marginal Expenditure Curve

Curve describing the additional cost of purchasing one additional unit of a good.

Factor of Production

An economic resource that is used to produce goods and services, including land, labor, capital, and entrepreneurship.

Average Expenditure Curve

Supply curve representing the price per unit that a firm pays for a good.