Question 1 (1 point) -I: The marginal revenue for a firm in monopolistic competition is 0 equal to average total cost 0 a little larger than marginal cost 0 none of these answers are correct 0 equal to the price as determined in the market 0 equal to the price as set by the firm Once they have determined optimal output, a monopolistically competitive firm will 0 select a price from the demand curve 0 select a price from the marginal cost curve 0 None of these answers is correct 0 select a price from the marginal revenue curve 0 select a price from the average total cost curve Which of the following is most likely to increase the short run profits of a firm in a monopolistically competitive market? 0 an increase in average total costs of the firm 0 an increase in the number of firms in the market 0 a decrease in the elasticity of demand for the firm's product 0 a decrease in the number of consumers in the market 0 an increase in the elasticity of demand for the firm's product A trigger strategy in a repeated game is 0 never used 0 a strategy that both firms hope will occur 0 a strategy that will hurt the other player but not the player who uses the strategy 0 a strategy that will force the firm to exit the industry 0 a strategy that will force a firm to change from cooperative play to competitive play A dominant strategy for a firm is one O that we expect the firm will select in a noncooperative game 0 that will yield a higher payoff than to the other player 0 that will maximize the firm's payoff O that will never be played due to the dominance of the strategy 0 that is usually the best response in a game Question 6 (1 point) Listen In monopolistic competition O there are only a few firms O there is only one firm O there are barriers to entry O firms produce identical products O firms produce similar but not identical productsPrice discrimination is O illegal in Canada and most developed countries 0 likely to decrease the profits of firms 0 illegal in Canada 0 common in Canada 0 legal in Canada but only if it is based on improving the welfare of consumers Question 8 (1 point) Listen In the long-run, we expect a firm in monopolistic competition to O earn zero economic profit O earn positive economic profit O earn negative economic profits O leave the market O become a monopolistThe wide variety of products in a monopolistically competitive market 0 signals that this model is probably not appropriate for the market in question 0 does not increase consumer welfare 0 may increase consumer welfare 0 results in the market operating at the efficient level 0 minimizes the average total cost of firms in the market After careful analysis, a firm in monopolistic competition decides to start an advertising campaign. As a result, we expect which of the following? (Select all that apply) After careful analysis, a firm in monopolistic competition decides to start an advertising campaign. As a result, we expect which of the following? (Select all that apply) C] an increase in the firm's profit D an increase in quantity demanded for the firm's product O no change in the demand curve but a movement along the firm's demand curve O no change in the price the firm will charge [3 an increase in the firm's costs C] an increase in the firm's profit D an increase in quantity demanded for the firm's product O no change in the demand curve but a movement along the firm's demand curve O no change in the price the firm will charge [3 an increase in the firm's costs Question 11 (2 points) -I: Which of the following are true in a long run equilibrium for a monopolistically competitive market? (Select all that apply) O firms set a price to ensure that their profits are zero O firms select output where the price of their product is equal to the marginal cost O firms produce a quantity and charge a price that can be 0 firms select a price from the marginal cost curve 0 firms operate at an output that results in an average total cost that is lower than the marginal cost FIRM B Advertise Advertise More Less 1, 3 4, -5 3, 5 0, 0Advertise More Advertise 1, 3 More FIRM A Advertise 3, 5 LessGiven the above payoff matrix for a duopoly, consisting of Firm A and Firm B, in which each firm is considering a change in advertising, answer the following questions (all payoffs indicate changes in annual profits measured in million of dollars). A. Does Firm A have a dominant strategy? Explain. B. Does Firm B have a dominant strategy? Explain.