True or false

8) Assume the market price is greater than average total cost at the perfectly competitive firm's profit-maximizing level of output. In this case, the firm is earning positive economic profits, which act as an incentive for new firms to enter the market.

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9) When a perfectly competitive market is in long-run equilibrium, price is equal to marginal cost, the individual firm is operating at the minimum of its short-run and long-run average cost curves, and economic profit equals zero.

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10) When the percentage change in quantity supplied is greater than the percentage change in price, supply is said to be elastic.

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11) Price will always exceed marginal cost for the profit-maximizing monopolist, or any price-setter firm for that matter.

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12) Barriers to entry serve to limit the number of firms that operate in a particular market and, as such, reduce the amount of total profit earned in the market.

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13) Efforts by firms to secure patents increase the amount of competition in the affected markets.

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14) If the cross-price elasticity of demand between two products is positive, we can conclude that the two products are substitutes.

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