A monopolistically competitive firm:
A. sells products that are perfect substitutes for its competitors' products, so must compete on the basis of location.
B. will be more successful the more similar its output is to its competitors' output.
C. sometimes distinguishes its output from that of its competitors by locating in a more convenient place.
D. sells products that are close substitutes for its competitors' products, so will locate as far away from its competitors as possible.
Answer: C
You might also like to view...
The imposition of a tariff will typically ________ government revenue and ________ domestic production of the good
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease E) increase; not change
The economic model of consumer behavior predicts that
A) consumers divide their time between consumption and leisure activities in order to maximize social welfare. B) consumers will try to accumulate as many goods and services as they can before they die. C) consumers will choose to buy the combination of goods and services that make them as well off as possible from those combinations that their budgets allow them to buy. D) consumers will try to earn as much income as they can over their lifetimes.