23. In which two market models would advertising (imaginaryproduct differentiation) be used most often?

A) pure competition and monopolistic competition

C) monopolistic competition and oligopoly

B) pure competition and pure monopoly

D) pure monopoly and oligopoly

24. Under pure monopoly, a profit-maximizing firm willproduce:

A) in the inelastic range of its demand curve.

B) in the elastic range of its demand curve.

C) only where total costs are zero.

D) only where marginal revenue is zero.

25. A monopolistically competitive industry is like a purelycompetitive industry in that:

A) each industry produces a standardized product.

B) nonprice competition is a feature in both industries.

C) neither industry has significant barriers to entry.

D) firms in both industries face a horizontal demand curve.

26. When economic profits in an industry are zero and implicitcosts are greater than zero:

A) resources will move out of the industry.

B) there will be no production in the short run.

C) accounting profits will be greater than zero.

D) resources may remain in the industry, but they will beunproductive.

27. A profit-maximizing firm should shut down in the short runif the price it receives is less than:

A) average variable cost.

B) average total cost.

C) average fixed cost.

D) marginal cost.

28. When firms in an industry reach an agreement to fix prices,divide up market share, or otherwise restrict competition, they arepracticing the strategy of:

A) interindustry competition.

B) limit pricing.

C) price leadership.

D) collusion.