microeconomics chp 16

1 [#) Which of the following is not a characteristic of monopolistic competition? O A A large number of sellers. O B Firms are price takers. C There is free entry into the market. O D Sellers offer products that are, in some way, different from their competitors' products. 2 [#80) A similarity between monopoly and monopolistic competition is that, in both market structures, O A strategic interactions among sellers are important. O B there are a small number of sellers. O C sellers are price makers rather than price takers. O D product differentiation is important. 3 If firms in a monopolistically competitive market are earning positive profits, then O A firms will likely be subject to regulation. O B barriers to entry will be strengthened. O C some firms must exit the market. O D new firms will enter the market.4 In monopolistically competitive markets, free entry and exit suggests that O A the market structure will eventually be characterized by perfect competition in the long run. O B all firms earn zero economic profits in the long run. O C some firms will be able to earn economic profits in the long run. O D some firms will be forced to incur economic losses in the long run. 5 [2) In both perfect competition and monopolistic competition, O A each firm is, in many ways, like a monopoly. () B each firm sells a product that is at least slightly different from those of other firms. O C each firm faces a downward-sloping demand curve. O D each firm has many competitors