Title: PCE 9 Flashcards | Quizlet
Headings: PCE 9
PCE 9
STUDY
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Key concepts:
Terms in this set (55)

Content: the selling price of the product
the variety of the product
the level of advertising
a monopolistic competitive firm's demand curve is
downward-sloping like the demand curve for a monopoly, not horizontal like those in purely competitive markets
barriers to entry into an oligopoly most resemble those of a: pure monopoly
productive efficiency in monopolistically competitive markets does not occur in the long run because firms set the price
on the demand curve where MR=MC to maximize economic profit, making output less than optimal from society's perspective
which of the following is not an example of product differentiation? some stores may charge different prices
allocative efficiency is achieved in the short run when the equality of which of the following occurs? P=MC
when Mary tried to get an appointment with a local dentist she was told that the earliest the doctor could see her was in three weeks. this may have been due to a lack of
excess capacity
true or false: firms in an oligopoly always produce a homogeneous product
false
compared with oligopoly and monopoly, entry of new firms into monopolistically competitive industries is
relatively easy because economies of scale are few
a monopolistically competitive firm's demand curve is
highly but not perfectly elastic
(it is elastic because the monopolistically competitive seller has many competitors producing closely substitutable goods, the latter being a determinant of the elasticity of demand
the monopolistically competitive firms economic profit per unit when producing at Q1 units of output
the difference between P1 and A1
(recall that profit can be calculated as price minus average total cost (ATC) multiplied by output. Here P1 represents price and A1 represents ATC at Q1 units of output)
which of the following contributed to making the American auto industry into a differentiated oligopoly for nearly a century? entry barriers into the auto manufacturing industry
the strategic behavior of competitors
mergers to help gain economies scale
the metal interdependent of each firm's profitability
oligopolies must consider the possible reaction of rivals to its own __,__ and __ decisions. pricing, output, advertising
all of the following are examples of oligopolies that produce a differentiated product except
copper
in monopolistically competitive industries
collusion is unlikely because there is a large number of firms
one of the largest barriers to entry into the refining industry is
the capital equipment investment
all of the following are reasons why firms might merge, except: to decrease monopoly power
in the figure, excess capacity
is the gap between Q3 and Q4
the elasticities of the demand curves for firms in monopolistically competitive (MC) industries will become more like that firms in pure competition as
the number of rival increase and produce differentiation grows weaker
(in pure competition, demand is perfectly elastic as exhibited by a horizontal demand curve because there are many rivals each producing an identical, substitutable product.